Can't Stop the Music (1980) was mentioned earlier, that's probably the worst musical I've seen. From imdb trivia "This film, playing on a 99-cent double bill with Xanadu (1980), inspired John Wilson to create the Razzie Awards in 1980". This year's Razzie awards are coming up, I've never seen Xanadu, in the spirit of the Razzies I'm going to have to watch it sometime.
The First Nudie Musical (1976) - low budget cult film, has catchy songs like "Orgasm", "Lesbian, Butch, Dyke", and "Dancing Dildos". Someone on imdb pointed out to me this movie has been re-released on dvd! Very bad film, but made me laugh.
The Broadway Melody of 1929 - maybe has the worst dance numbers I've seen in a movie. Hollywood has come a loooong way from this crappy early musical effort.
Sweeney Todd: The Demon Barber of Fleet Street (2007)
But it should be said that i have not really seen that many musicals. I am sure there are musicals that is worse than Sweeney Todd. But out of the once i have seen that is the worst.
If you think that version was bad... TCM just showed the taped stage production of this from 1979... everyone else was okay -- a little hard to accept such OLD people playing what should be teenagers and a preteen but c'est la vie. I was so turned off by the only noteworthy person in this -- ANGELA LANSBURY!!! GOOD GOD SHE WAS PITIFUL TO WATCH AND PAINFUL TO HEAR!
OFF KEY AND IN A TOO HIGH TONE FOR HER.
let it go let it go let your love open da door...
as my 3 1/2 year old niece sings it. much better message.