I posted a form of this elsewhere, so apologies if you've seen it before:
Until recently, novels were pretty sparse and most weren't very good mainly because the writers were trying too hard to imitate HPL. Over the 20-30 years more writers have incorporated Lovecraftian themes into their own work. Still, anyone who reads Lovecraft can't be allergic to short fiction, so some collections are listed as well as novels.
The Grin of the Dark by Ramsey Campbell. Campbell started publishing as a teen, a slavishly imitative teen, who later found his own voice and themes and concerns and started melding his influences into fiction that was distinctively his own. This book is one of the most frightening books I've read as we watch a film reviewer get to know too much about his subject and the subject take over his life. See Cold Print for a collection of his Lovecraftian short stories.
The Red Tree & The Drowning Girl by Caitlin R. Kiernan. Unreliable narrators take you through two harrowing stories. I think these two might be best read together, one reflecting a bit off the other. Kiernan is an exceptional writer. I've read her collection To Charles Fort, With Love and other some of her other stories, and they are definitely influenced by HPL, but also by Shirley Jackson and others. Excellent writer.
Grimscibe by Thomas Ligotti. Story collection. Ligotti is one of the most original writers of horror/dark fantasy in the last 30-40 years. He melds HPL with his own philosophical bent and produces a distinctive and often disturbing body of work. This book tries to be a novel with connective vignettes, but really isn't. The best stories are powerful, the lesser ones are still damn weird.
The Croning by Laird Barron. Not as intense as his short fiction -- The Imago Sequence has some truly disturbing stories -- but still an effective story about an aging man with holes in his memory trying to understand what he's gotten himself involved in and how it's directed his life.
Lovecraft Country by Matt Ruff. Not as intensely Lovecraftian as the above; a lighter take on HPL. Ruff explores the Outsider, in this case the 1950's African-American, and manages to skewer the Jim Crow era while also having fun with s.f. genre of the time. About to come to HBO from Jordan Peale and J.J. Abrams.
The Ballad of Black Tom by Victor LaValle. Racism is wound into HPL's work, and LaValle is drawn by the imagination and invention, and repelled by the racism. This is his response, working off "The Horror at Red Hook."
Carter & Lovecraft by Jonathan L. Howard. Another lighter work I found entertaining.
House of Windows & The Fisherman by John Langan. Both novels concern thin areas between our dimension and a dimension where vast entities dwell and sometimes reach into our world. The latter is widely known and admired by fans of Lovecraft, and rightly so. The former is, in my opinion, unjustly neglected.
We Are All Completely Fine & Harrison Squared by Daryl Gregory. The former is a novella, very quick reading, at times a lighter version of HPL-ish fiction, but Gregory’s Scrimshander, more implied than shown, is one of the more frightening characters I’ve come across in fiction. The latter novel was marketed as a YA novel, accentuating the humor you find a bit of in the novella and still manages to be suspenseful and imaginative.
The Bone Key by Sarah Monette. Monette’s stated intent was to meld Lovecraft with the M. R. James ghost story while dispelling the inherent misogyny. She does a fine job. I wouldn’t call most of the stories especially scary, though “Raising Helena” is effective and introduces the recurring character of Kyle Murchison Booth. She has an underlying sense of humor that rears up in a couple of the stories in enjoyable ways.
Related and of interest,
Zothique by Clark Ashton Smith. It’s the end of the world and necromancers have mostly taken charge. A series of short stories that grow weirder as they proceed, and more involving for all that. Probably a hard book to find now, but worth it if you trip over. Smith was a contemporary, friend and correspondent of Lovecraft’s; his weird work may well be weirder than HPL’s. All of Smith’s short work has been collected and published courtesy of NightShade (now part of Skyhorse Publishing).
The Throne of Bones Brian MacNaughton. MacNaughton’s story collection springs off of Smith’s work, much of it dedicated to the doings of ghouls. Macabre stories girded at times by a graveyard humor.
Experimental Film by Gemma Files. Not exactly Lovecraft, but again an example of cosmic horror in the vein he was exploring.
Honorable mentions,
The House on the Borderland by William Hope Hodgson. Pre-Lovecraft, Hodgson touches on the kind of cosmic horror that HPL was striving for. A very odd book, one I didn’t find entirely satisfactory, but which stays with me all the same.
Midnight Sun by Ramsey Campbell. Forgot to mention this one yesterday. Critics say it’s more like Arthur Machen, and I’m willing to believe that. To me, it also feels like one of the best Stephen King novels not written by King, and again has the kind of cosmic horror HPL strove for.
A Night in the Lonesome October by Roger Zelazny. A tale in which fictional characters like Count Dracula and Sherlock Holmes fight for or against the coming of the ancient gods (read, Lovecraft’s entities). This sounds slight when summarized, but is immensely fun in the reading, especially around Halloween.