We talk about best, worst, etc. But there are movies that transcend opinion and changed the face of Horror forever. Like them, hate them, or don't understand them, it doesn't matter for they were the ones that had impacts on countless of generations of young filmmakers.
The original German expressionism wave did that, with brilliant horror movies like Nosferatu and the cabinet of dr. Caligari. Or M. They pretty much invented the horror genre in movies, and deserve the biggest mention.
Pyscho, well, it speaks for itself. Texas chainsaw inspired every gore slashers movies that came out after it. Halloween redefined it for mainstream AND with a better story (but a far lesser direction, though). Alien propelled the Sci-fi horror genre to a whole new level (you know, the kind of level that is actually scary, unlike most great but so darn cheesy sci-fi movies before that).
Jaws, well, it scared a whole generation to go at the beach. And since then, I won't even try to count the number of wannabe that came out (not just in shark movies, but also by great little movies like Tremors who were inspired by it).
The exorcist took the most sacred subject of it's time (religion) and played on it's fear. Oh how marvelous that one must have been back then.
I'd like to mention the Omen, because of how good it is, but it rode on the exorcist's success more than anything else, and aside from sequels and a remake, it didn't inspire as much as the other movies above.
And then there's the movies that didn't inspire anyone when they first came out, but are now seen as pionners and some of the greatest inspirations nowadays: movies like the Shining or the Thing. Both so different from everything else on the market, and yet back then, they didn't launch a bunch of immitators. Of course, now they inspire filmmakers on all level, so they need to be at least mentioned.
While I hate to mention it, Scream also propelled the bad wave of teen movies in the 90's. The wave of tonedown horror about a "who's the killer now ?" kind of movie. Craven at least deserves respect for bringing something that had such an impact.
Ringu launched both a wave here and in Japan, and is a must to mention.
The old universal classics monsters were inspirations for many also. From the invisible man to Dracula to the wolf man, they are still getting remade today.
Romero with his night of the living dead nearly created the zombie genre.
These, imo, are the main big ones. I'm probably forgetting some (and no, i'm not mentionning people's favorite horror title here, but rather the most important ones), so, if someone has an idea of a title who propelled the genre to new level back then, feel free to name it.
There are many important Italian movies out there from the 70's and 80's, but i'm not sure which one should be mentioned. I really didn't care much for Argento's Suspira, but I know how important it is. So, there.