ET is one of the most successful movies of all time, but the Atari video game it inspired proved one of the biggest flops in history and ended, legend has it, with the mass burial of millions of unsold games and the near-collapse of the gaming company.

On Saturday, a team of contractors, guided by archaeologists and watched by a Hollywood film crew, will start a dig in a New Mexico landfill to try to unearth the truth about one of the biggest mysteries in gaming history.

In the early 1980s, Atari accounted for 80% of the video games market, with gamers eagerly snapping up its console versions of arcade classics including Asteroids and Space Invaders. In 1982, it released ET: the Extra Terrestrial, for the Atari 2600 console, after buying the rights from director Steven Spielberg and Universal for $22m.

It was a bold move into a new type of gaming, one based on a movie, not an arcade hit. But the game itself was panned. Players were supposed to find parts of an interplanetary telephone that would allow ET to phone home. Instead, they spent much of their time falling into badly-designed holes. Sales were a disaster, and contributed to Atari’s spectacular collapse. By 1984 Atari was defunct, the biggest victim of what became known as the North American video games crash.

As Atari was approaching game over, the New York Times and others reported the company had dumped “14 truckloads of discarded game cartridges and other computer equipment at the city landfill in Alamogordo, New Mexico.” Guards reportedly kept reporters and spectators away from the area as workers poured concrete over the dumped merchandise.

Not everyone agrees that this was truly ET’s fate. Howard Scott Warshaw, the game’s designer, believes the landfill story is an urban legend.

Whatever the truth, the story is now the subject of two films. Saturday’s dig is being coordinated by Fuel Entertainment and Xbox Entertainment Studios for a documentary directed by Zak Penn, writer of The Avengers and X-Men 2. It will air as one of a series of documentaries and other original programmes being developed for Microsoft’s Xbox games console users. The ET burial will also be the centerpiece of an independent comedy, Angry Video Game Nerd: The Movie, now in production.

Penn, his crew, and University of North Dakota archaeologist Bill Caraher are expected to break ground on Saturday. Caraher’s specialty is fifth-to-10th-century Christian architecture in the Mediterranean region, but he’s also a former Atari 2600 owner. He told local newspapers that he hopes he may also unearth an early, and apparently awful, version of Pac-Man in the landfill.

“Other than garbage and the truth, I have no idea what we’ll find. I think that’s what’s exciting, we won’t know exactly what’s down there until they start digging. Alamogordo, 26 April, be there to find out the truth,” Penn told ABC News.