Black Canyon is described as a narrow, small canyon, above the Hollywood, where Terror Castle, the former home of Stephen Terril, is located. When Peter Crenshaw and Jupiter Jones went to the canyon for investigating Terror Castle, Pete, seeing that the canyon was like a narrow, winding road, without a house in sight anywhere, commented, "Whoever named it Black Canyon knew what he was doing."
The canyon has a fault in its rocks, that runs through the ridge to the other side, where Winding Valley Road ended. Stephen Terril had walled the tunnel, but also secretly installed a hidden door. Then, in Jonathan Rex's persona, he bought the land at the othe side of the passage, and built a small house there. This way, he could come in and go out of the Terror Castle without being noticed.
Charlie Grant, a friend of Terril's, lived in a bungalow, which was barely visible, near the entrance to Black Canyon. Thus, he was able to see everyone who entered the canyon. Whenever he saw someone, he would quickly telephone Terril or Rex, who could hurry through the natural tunnel to scare them.