Blue City arrived when Judd Nelson, Ally Sheedy, and their fellow young stars were being marketed as the next generation of Hollywood royalty, but its reception helped expose the volatility of that label. Michelle Manning described the actors as intensely ambitious and privately anxious that their sudden popularity could disappear, and the film's failure coincided with what she called a broader 'Brat Pack backlash.' The reviews were unusually personal and vicious: newspapers described Nelson as smirking, limp-jawed, and miscast as an action hero, while one critic compared Sheedy to a wilted flower. Sheedy later admitted that she had not particularly liked the movie and had naively hoped that editing would somehow supply the qualities missing from the finished production. Manning likewise believed critics judged her more harshly because she was a woman making a violent, Peckinpah-influenced thriller rather than the kind of gentler material expected from female directors. The fallout was severe: despite having a Paramount producing deal and continuing to develop projects, Manning never received another opportunity to direct a feature.
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