The origins of Touchstone Pictures can be traced to the 1979 release of The Black Hole, a science fiction film that sparked controversy due to the fact that it was the first Disney film to receive a PG rating. Over the next few years, Disney experimented with more PG-rated fare, such as the 1981 film Condorman and 1983's Trenchcoat. The latter film attracted major criticism for including adult themes that were considered inappropriate for a Disney film. The controversy over Trenchcoat is generally considered the catalyst that sparked the creation of Touchstone Pictures. One title considered for the new company was "Hyperion Pictures," named after the location of the studio in the 1930s before the move to Burbank.
Ironically, some critics complained that the creation of Touchstone in order to distribute more adult content was itself inappropriate for Disney.
Founded by Disney CEO Ron W. Miller in 1984, Touchstone's first release was Splash, a huge hit for the studio. The film included brief nudity on the part of star Daryl Hannah and adult language.
The unit became a top source of income for Disney during the 1980s. Touchstone/Disney's first R-rated film, Down and Out in Beverly Hills, came in January of 1986 and was another smash. "Ruthless People" followed in April of 1986 and was also huge. One example of a recent release is Signs (2002). Touchstone is still an active unit of the company today.