When the scene in the swamps of sadness was being shot and the horse was supposed to "sink", he really did. The platform lifts failed and the horse died. Noah Hathaway
"atreyu" was so upset he couldn't do anything for two weeks. That was the only bad event in the production of the movie, I believe.
I do not believe that the horse died during filming as it says in the behind the scenes section, as shortly after the NeverEnding Story was released in Australia, I saw an interview with Noah Hathaway where he said that once the shoot for the movie was over he was offered the horse as a present. He said that he absolutely loved the horse and had formed quite an attachment to it during the shoot but he couldn't accept it because his family had no way of looking after it. Would love this to be cleared up if possible.
Mara wrote in to add that Noah Hathaway confirmed at the Sydney Australia pop culture expo that the horse did not die during filming, he was offered to keep it as the "wrap" present (wrap meaning "thats a wrap" when filming is complete)