Shadowghast / Thomas Taylor ; illustrated by Tom Booth.

Enhanced descriptions from Syndetics:

In the third mysterious tale of Eerie-on-Sea, it's almost Ghastly Night, and the Shadowghast--an ancient spirit in a lantern--lurks in wait for the power to enslave the town.

In this third adventure, shipwrecked orphan Herbert Lemon, Lost-and-Founder at the Grand Nautilus Hotel, must square off with a creature of town lore as he confronts a shadow from his past. While other towns celebrate Halloween, in Eerie-on-Sea it's Ghastly Night, and a grim spirit in a lantern awaits its moment. Legend has it that if people fail to light manglewick candles on Ghastly Night, and if no showman conjures shadow puppets on the pier as an offering, the insulted Shadowghast will seize and devour the shadows of the living. This year, a professional theater troupe has been summoned, including a raven-haired magician named Caliastra with startling news of Herbie's origins. No sooner have the players checked into the hotel than townspeople start vanishing into thin air, including the guardian of Herbie's best friend, Violet Parma. It's up to Herbie and Violet to separate truth from sleight of hand and solve the mystery of the Shadowghast lantern before darkness swallows them all.