Lucio Fulci's 1982 ‘giallo’ arrived at the BBFC’s offices, for classification for cinema release, in December 1983. By that point, three of the director’s horror titles had already become embroiled in the ‘video nasties’ moral panic. The Beyond, House by the Cemetery and Zombie Flesh Eaters all featured on the Director of Public Prosecutions (DPP) office's list of potentially obscene titles. The BBFC did not compile the list, it was created by the DPP to help police forces avoid confusion when seizing potentially obscene material on video.

The title of The New York Ripper and the film's theme were also unfortunate given the UK planned release also coincided with heightened public sensitivity following the conviction of serial murderer Peter Sutcliffe (the so-called ‘Yorkshire Ripper’).

Opinion was divided between the five Examiners who undertook the film's initial viewing, on 14 December 1983. Three argued the film could be cut for 18, while two felt it should be refused a classification outright. Those who argued the film should be rejected, or refused a classification, did so for two reasons. Partly, they believed the level of cuts required would leave no viable product for the company to release, and partly because they were concerned that the film's perceived misogyny might have a corrupting effect on viewers. There were further viewings, during December 1983 and January 1984, but no greater consensus emerged amongst examiners.

As a result, the BBFC's Director, James Ferman - who himself favoured refusal of classification - referred the film to the BBFC's President, Lord Harlech. Lord Harlech concluded that:
"Two years ago it might have been worth trying to cut this very heavily for 18. But now, the law of obscenity would seem to catch this material squarely".

Harlech therefore advised that the BBFC should monitor court cases currently pending against some of the so-called 'video nasties' before reaching a final conclusion.

When the UK distributor of horror title Nightmares in a Damaged Brain was found guilty at the Old Bailey shortly afterwards (in early February 1984), and jailed for distributing obscene material, it seemed clear that The New York Ripper could be at potentially equal risk of being found obscene. On 15 February 1984, James Ferman wrote to the UK distributor of The New York Ripper advising that the film could not be classified for cinema exhibition because it was likely the courts would find against it.

At that time, it was still possible to release a film on video cassette without a BBFC rating, as the Video Recordings Act 1984 did not come fully into effect until 1 September 1985. James Ferman warned the distributor that though it was possible, releasing the film on video cassette would only increase the risk of an obscenity prosecution and conviction, because of the greater potential for a film getting into the hands of children when released for home entertainment.

If Ferman had merely written to the distributor confirming the decision to refuse a BBFC classification, The New York Ripper may have simply been another work denied a release during the 'video nasties' era. However, what Ferman did next meant The New York Ripper became something of an urban legend (which persists in cult and horror film circles to this day).

The fact the UK distributor of Nightmares in a Damaged Brain had just received a prison sentence for his role in distributing his film made the potential for the distributor of The New York Ripper to become embroiled in an obscenity case seem very real. Therefore Ferman decided it would be unwise for the BBFC to return the film to its distributor. Ferman was aware that the distributor could still release The New York Ripper on video tape (or seek local authority approval for local cinema exhibition), in spite of the BBFC's judgement that any release of the film was at risk of comprising an obscene publication. To do so would not only risk the distributor being vulnerable to a charge of being found in possession of an obscene work with intent to commercially supply, but could also potentially put the BBFC in the difficult position of having facilitated that supply.

Accordingly, Ferman took the unusual step of informing the UK distributor that the BBFC would be re-exporting the submitted print to the original rights holders in Italy, also advising him that he should similarly dispose of any further copies of the film in his possession. The BBFC’s actions took place in a time and climate in which UK distributors were being convicted and even sent to jail for their involvement with similar films. However, it is easy to see how the legend developed that The New York Ripper was so uniquely powerful and offensive that every print had to be escorted from the country. Some stories go so far as to suggest the film had been removed under armed guard.

Impressive though the story has been as a marketing tool, the truth is rather more prosaic - and in fact based on protecting the UK distributor from potential legal action.

Perhaps because of the film's toxic reputation, it did not return to the BBFC until 2001, after James Ferman had retired. In a rather less heated atmosphere, and with new published classification guidelines based on public consultation, the film was classified 18, after 22 seconds of cuts to material involving the mutilation of a woman's breasts. In 2012, focus groups participating in BBFC research into audience reactions to sexual and sadistic violence watched the cut material. They concluded that the film and its effects appeared dated and it was not particularly shocking compared to modern films. The film has not been sent back for reclassification since that time.