DWELLERS IN THE MIRAGE: Sci-Fi Classic

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Leif Langdon is an American explorer who discovers a warm valley in Alaska. Two races inhabit the valley, the Little People and a branch of an ancient Mongolian race; they worship the evil Kraken named Khalk'ru which they summon from another dimension to offer human sacrifice. The inhabitants recognize Langdon as the reincarnation of their long dead hero, Dwayanu. Dwayanu's spirit possesses Langdon and he starts a war with the Little People Civilization.