It may sound like the beginning of a horror movie, but burial sites found on a college campus have created a potential nightmare for administrators.

While surveying land for a new parking lot at the University of Mississippi Medical Center, officials made a grisly discovery: more than 1,000 bodies thought to have been patients at the old Mississippi State Lunatic Asylum.

The unnamed, century-old graves present a problem for the university, whose expansion plans could be halted over the cost of relocating the bodies....