Al Thompson, a 64-year old native of Glen Allen, Virginia (a suburb of Richmond) is already feeling the stress of the holiday season. But not because of gift shopping or family obligations. He’s stressed about the Christmas lights he plans to display on his house and front lawn. “There’s a lot of pressure to perform,” he says with a sigh. “People have pretty big expectations.”

He’s not exaggerating. Every year, with the assistance of his wife Esther, the exterior of his property is covered with approximately 170,000 lights and 500 different Christmas figures, all built from scratch. Setting up such an ambitious display is not as easy as just draping his house in lights and flipping a switch. He claims it takes at least 400 hours to set everything up, a pain-staking process that begins in mid-September and becomes a full time job. He’s also installed 80 additional outlets in his home, enough to handle the 500 extension cords necessary to supply enough power. And then there’s the small matter of his electrical bill, which he claims is usually $1,000 or more during December.

Thompson’s obsession with Christmas lights may sound a little crazy — he’s been doing it since 1999, and every year the operation gets a little bigger — but in recent years his house has started to become a national attraction. In 2007, he beat out New York City’s Fifth Avenue in USA Today’s “10 great places to plug into the Christmas spirit.” And last year, he won the coveted “Most Likely To Be Seen From Space” award from the popular website Tacky Lights Tour (tackylighttour.com).

By Thompson’s estimate, he has thousands of visitors every holiday season, who travel to Virginia from across the country and at least 65 foreign countries. “We have regulars now,” he says. They come from New York and California and even Europe. “And the first thing they say to me when they show up is, ‘We’re back. What’s new?’”

There was a time when people decorated their houses for Christmas just for fun, or for the benefit of their friends and neighbors. But as the world has gotten smaller, thanks in large part to the Internet, holiday decor has attracted a global audience. More than 80 million homes in the United States are publicly decorated for Christmas every year, according to Minami International Corporation, a major lighting manufacturer. And for many of them, they’re flaunting their Christmas cheer (and wattage) to an increasingly international fan-base. It’s not enough anymore to be the most lavishly illuminated home on your block. You now have to be the best decorated home in the Western Hemisphere.

The cultural epicenter of Christmas lighting, its glittery heart and soul, is Richmond, Virginia. According to Barry “Mad Dog” Gottlieb, the creator and former spiritual guru of the Tacky Lights Tour — which celebrates its unofficial 25th anniversary this month — Richmond has a long history of excessively decorated homes during Christmas. “You’re talking about a city where people spend half of their year or more working on their Christmas lights,” he says. In 1986, Gottlieb got the idea to host an informal bus tour of Richmond neighborhoods. Tour guests were fed beer and cookies and encouraged to nominate their favorite houses for a variety of awards, including Mass Quantity, Overall Wattage, Acid Flashback, and the coveted Holy Shit! Factor.

“It could get competitive,” Gottlieb says. “People would be very upset if their houses weren’t picked. I thought, ‘We’re going to start a war here if we’re not careful.’” Although Gottlieb retired his tour after a few years, it spawned thousands of imitators. Tacky Light tours have become a cottage industry in Richmond, and some companies, like the Winn Bus Tours, charge up to $500 for a four-hour guided tour.

The Tacky Lights Tour website, launched in 2004 by Matt Burgess, started as a resource for visitors looking to do their own Christmas tours of Richmond, providing an interactive map of the city’s most audacious residential light shows. But as the site’s popularity grew, it began including photos and information on houses outside of Virginia. Today, you can find addresses and even driving directions to garishly-decorated houses in 37 states, 167 cities, and five countries, including Australia, Canada, Denmark, and the United Kingdom. “It seems to be growing organically each year,” says Burgess.

There’s only one qualification for a house to be featured on the site. It must have no less than 10,000 Christmas lights on display. “My Web traffic has doubled every year,” says Burgess. “And so have the number of lights.” With so many amateur home decorators struggling to out-do each other, they may be unwittingly putting themselves at risk. According to the National Fire Protection Association, 170 home fires are caused annually by defective holiday lights (and that doesn’t include those on a Christmas tree), with an average of seven lights-related deaths every year. It may not sound like much, but the fact that anybody dies at all in the pursuit of spelling out “Merry Christmas” on their roof makes it seem less like a harmless hobby and more like an Evel Knievel stunt.

Not everybody has the time or fearlessness to cover their homes with 10,000-plus lights. Which is why some people seek out professionals, like Josh Barnett, the founder and president of the Bakersfield, California-based Lightasmic! Although Barnett’s company — which, according to their website, creates “nighttime spectaculars” — works mostly with local governments and theme parks, he does occasionally decorate for home owners, especially if their lighting needs are “extreme.” Barnett’s pièce de résistance is an annual Christmas lights show for the California Living Museum, with a staggering two million lights, running on six generators and synchronized to holiday music. But his expertise doesn’t come cheap. A Lightasmic! production, either for a residential or business space, can cost anywhere from $20,000 to $100,000 or more. “If you gave me half a million dollars,” says Barnett, “I could give you a lighting design that will rock your socks off!”

In the Christmas lights game, size clearly matters. But it’s not always about how many lights you have. Sometimes it’s how big your audience is. Just ask Alek Komarnitsky, an engineer from Boulder, Colorado who calls himself a “Clark Griswold wanna-be” (a reference to Chevy Chase’s lights-obsessed character from the 1989 movie National Lampoon’s Christmas Vacation). He rarely decorates his home with more than 20,000 lights. But he does have a live webcam. Three different webcams, in fact; mounted from various positions around his property, allowing Internet visitors to admire his lights from anywhere in the world. And since 2005, they can even control the lights with X10 powerline technology, turning them on and off during certain hours, and inflating (or deflating) characters like Frosty, Santa, and Homer Simpson. “It can sometimes be a battle for control,” Komarnitsky admits.

With an international audience — he averages half a million unique visitors each year, coming from 157 different countries — Komarnitsky has learned that it’s impossible to please everybody. “People in Europe complain all the time because of the time zone difference,” he says. His Christmas lights only stay on between sunset and 10pm mountain time (“to be fair to my neighbors”) so his fans in London can’t see any of it unless they’re awake between midnight and 5am. “They get really upset about it,” he says.

Sometimes the gaudy Christmas lights displayed on the Internet aren’t necessarily being celebrated. Websites like Tacky Christmas Yards (www.tackychristmasyards.com) and Ugly Christmas Lights (www.uglychristmaslights.com) poke gentle fun at homes decorated with the subtlety of Las Vegas casinos. Kat Shumar, an Indianapolis homeowner who started the Tacky Christmas Yards site in 2007, gets photo contributions from around the country, and every home on the site is categorized by “Violation,” which includes Unharmonious Arrangement, Seizur-ific and Frequent Lighter Card. According to Shumar, “People turn in their photos and allow me to do their dirty work and say what everyone is thinking.”

Not everybody enjoys the ribbing. The Ugly Christmas Lights site, launched in 2002 by Matt Phillips (who lives somewhere in the Northeast United States but declines to give specifics), has received some disturbing emails over the years. “I had no idea such hate mongers like you existed in this world,” one such letter begins, going on to compare Phillips to the Ku Klux Klan and Osama bin Laden. But Phillips doesn’t take the abuse personally. “Christmas lights can be a sensitive subject,” he says. He insists that he’s not mocking the holiday, “just people’s lack of decorating skills.”

As divisive as Christmas lights can sometimes be, they can also bring people together. Al Thompson remembers a couple from Moscow, Russia who visited his home on Christmas Eve 2008, traveling 5000 miles just to see his legendary light show. Thompson and his new friends reminisced about their childhoods, when they were both repeatedly warned to fear the other’s respective country. Only at that moment, united by their shared appreciation for holiday excess, did they realize just how misplaced their paranoia really was. “I still get goosebumps whenever I think about it,” says Thompson.

As it turns out, the secret to world peace just might be a suburban lawn covered in a few hundred thousand glittering twinkle lights, and an electricity bill well into the quadruple digits.

(This story originally appeared, in a slightly different form, in the November 17, 2010 issue of Bloomberg Businessweek.)