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The movie Donnie Darko is timed in the 80s (to be precise 1988), but the movie was released 2001. I can see no significance, to put it in the past. Yes, there was the presidential election, but that is only background for the plot in Donnie Darko. The same plot would have been possible to place in 2001.

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up vote 14 down vote accepted

I think this was done as a way for Kelly to show a more simplistic time rather than a time with all the technological advances being made. Also, there is a theory I saw here, in fact about the way the number 88 is a theme in the movie which would explain a lot about using this time period.

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I don't really buy the fixation on the number 8 given in the other answer as I see no apparent reason for this number. But if we think Kelly did that on purpose, it would explain the year '88. – Mnementh Dec 9 '11 at 16:26
That was the intended point. Kelly is, to me, the type of director to do everything in his movies on purpose. – TylerShads Dec 9 '11 at 16:48

Quoting from IMBD FAQ page:

Richard Kelly has given various reasons for this:

  1. It was a favorite time, when he was a teenager.
  2. Very few films have been set in the '80s.
  3. He didn't feel comfortable setting a teenage film now, with no knowledge of current teenage life.

(It could also be a reference to Back to the Future as both movies take place in the 80's and the movie is also referenced at some point during the film- And don't forget the DeLorean needed to reach a speed of 88mph in order to time-travel.)

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