Palmer, 29, will play the lead in David Sandberg's feature film directorial debut to be produced by James Wan.
The film is based on Sandberg's short horror movie of the same name which went viral, reported Deadline.
The horror movie will be Atomic Monster's second with New Line after "Annabelle".
The film is about a young boy and his estranged sister who, are confronted by an evil entity that only appears when the lights are out.
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