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Lovecraft is one of the early pioneers of the Horror genre. His most famous works are all set in what we now call Lovecraftian Horror or the "Cthulhu Mythos" which gets its name from the titular character in the short story "The Call of Cthulhu" - a gigantic monster with an octopus-like head and bat wings that lies sleeping (or dead) in the underwater lost city of R'lyeh and who is prophesied to one day wake up and enslave humanity.
Like so many artists of his era, his fame didn't occur during his own lifetime and he barely made any money from his stories. Nowadays his influence can be found in a great many things and many modern horror writers cite him as a major influence on their own works.