Even modern works of literature contain significant elements of horror, though these elements generally are downplayed in any serious treatment.
Golding's Lord of the Flies, which it seems nearly every student in the American public educational system is required to read at some point, is, at its core, a horror novel. While Flies is studied primarily for its use of the makeshift power structure that arises among a group of shipwrecked boys as a metaphor for the dangers of the prevailing society at the time, it operates on a basic level as a tale of increasingly horrific actions that occur to (or are perpetrated by) these boys.
Unfortunately, even this forgiving level of respect is not extended to the more popular works of horror fiction today.
An embodiment of this can be found in modern author Stephen King. Praised by some as a literary giant and derided by others as a sensationalist hack, King has transcended the boundaries of popular fiction by matching an outlandish imagination for horrific concepts with an astute eye for dialogue, plot and character. Because of this combination, King has elevated the base genre of horror to a legitimate literary field among those who are willing to give his work a chance.
With the ever-increasing popularity of King and the resurgence of older horror writers such as H.P. Lovecraft, however, horror seems to be primed for a movement toward literary respectablility.