Christmas Evil (also known as You Better Watch Out and Terror in Toyland) is a 1980 slasher film, directed by Lewis Jackson and starring Brandon Maggart. It is considered an obscure film but has gained a cult following which includes film director John Waters.
It was originally released as You Better Watch Out. Though lesser known, it predates the horror film Silent Night, Deadly Night, in which a deranged man goes on a murderous rampage dressed in Santa Claus clothing. Critical reception for the film has been mostly positive.
(Summary from Wikipedia)