The People Next Door spins off from previous Gemini Productions' sit-com The Godfathers. The child welfare officer who prompted much of the tension in the original program, Elizabeth Dent, is now married with a child of her own. She and her husband Bill also board Dave Milson, one of the 'godfathers' from the original series. Elizabeth, Bill, and Dave take a house next to misanthropic writer Daniel Penrose and his three children. Following the pattern established by The Godfathers, the program was focalised through the viewpoint of the youngest Penrose child, B.J.
Don Storey, in his Classic Australian Television, notes that the Nine Network commissioned 48 episodes, with an option to review after 16 episodes:
Perhaps it was the timeslot. Perhaps it was the changing tastes of a fickle public. Perhaps the formula was not quite right. Whatever the reason, The People Next Door was nowhere near as successful as The Godfathers. Low ratings caused Nine to exercise their option to reduce the number of episodes, and production ceased after 20 episodes were made.