I would argue that we should attempt to have a well-rounded list that represents decades and genres. That doesn't mean that we have equal representation, just that we don't have any obvious holes.
So, for example, I argue that Unforgiven is essential, as it is the only Western eligible for the list at all.
I would also encourage folks to (for the most part) shy away from very recent movies (last 5-10 years), as these films really haven't stood the test of time yet. This includes the Lord of the Rings trilogy.
Here's a breakdown of the existing and eligibile films by decade. A > denotes a film already on the list. I have indicated some of my personal "essentials" with a + after the film date--nothing official, just my opinions.
Please note that I am using registered titles at IMDB for this list. I would strongly encourage this practice throughout the formulation of this list (and elsewhere on the board).
I did my best to identify the films from the list, but without dates and/or directors, the names as they are are not precise. Several of which I was unsure are not on the list below.
1910s
Intolerance (1916)
1920s
> The Passion of Joan of Arc (1928)
Metropolis (1927) +
Sunrise: A Song of Two Humans (1927)
The Ten Commandments (1923)
1930s
The Hunchback of Notre Dame (1939)
Freaks (1932)
M (1931) +
1940s
> It's a Wonderful Life (1946)
Close-Up (1948)
The Bicycle Thief (1948) +
Open City (1945)
Day of Wrath (1943)
Dr. Jekyll and Mr. Hyde (1941)
How Green Was My Valley (1941) +
1950s
> Diary of a Country Priest (1951)
> Ordet (1955)
> The Seventh Seal (1957)
Ben-Hur (1959) +
Molokai (1959)
Nazarin (1958)
Nights of Cabiria (1957)
Paths of Glory (1957)
Wild Strawberries (1957)
The Ten Commandments (1956) +
A Man Escaped (1956)
The Night of the Hunter (1955)
Pather Panchali (1955)
On the Waterfront (1954) +
The Robe (1953)
Tokyo Story (1953) +
Living (1952)
Umberto D. (1952)
The Day the Earth Stood Still (1951) +
Francesco, giullare di Dio (1950)
Rashômon (1950) +
1960s
> The Gospel According to St. Matthew (1964)
> 2001: A Space Odyssey (1968)
> Andrei Rublev (1969)
My Night at Maud's (1969)
Faces (1968)
Bedazzled (1967)
Cool Hand Luke (1967)
Balthazar (1966)
A Man for All Seasons (1966) +
Becket (1964) +
Winter Light (1963)
The Silence (1963)
Whistle Down the Wind (1961)
La Dolce vita (1960)
1970s
> Le Fils (1973)
> Jesus of Nazareth (1977)
Apocalypse Now (1979) +
Hardcore (1979)
Life of Brian (1979) +
Perceval le Gallois (1979)
Stalker (1979)
L'Albero degli zoccoli (1978)
Days of Heaven (1978)
Gates of Heaven (1978)
Close Encounters of the Third Kind (1977)
Star Wars (1977) +
Dersu Uzala (1975)
The Hiding Place (1975)
The Mirror (1975)
Godspell (1973)
Jesus Christ Superstar (1973)
Fratello sole, sorella luna (1972)
Fiddler on the Roof (1971)
1980s
> Tender Mercies (1983)
> The Mission (1986)
> Dekalog (1987)
> Babette's Feast (1987)
> Wings of Desire (1987)
> The Last Temptation of Christ (1988)
> Crimes and Misdemeanors (1989)
> Jésus de Montréal (1989)
Do the Right Thing (1989) +
Field of Dreams (1989)
Henry V (1989) + (I thought Olivier's was better)
Romero (1989)
A Cry in the Dark (1988)
Hannah and Her Sisters (1986) +
Jean de Florette (1986)
Manon of the Spring (1986) +
Offret - Sacrificatio (1986)
Summer (1986)
Agnes of God (1985)
The Color Purple (1985) +
The Trip to Bountiful (1985) +
Witness (1985)
Amadeus (1984)
Places in the Heart (1984)
L'Argent (1983)
Koyaanisqatsi (1983)
Nostalghia (1983)
Blade Runner (1982) +
Gandhi (1982)
The Year of Living Dangerously (1982)
Chariots of Fire (1981) +
My Dinner with Andre (1981)
Raiders of the Lost Ark (1981)
Time Bandits (1981)
The Elephant Man (1980) +
Son of Man (1980)
1990s
> Groundhog Day (1993)
> Schindler's List (1993)
> Three Colors: Blue (1993)
> Dead Man Walking (1995)
> Breaking the Waves (1996)
> Ponette (1996)
> Secrets & Lies (1996)
> The Apostle (1997)
> The Big Kahuna (1999)
> Dogma (1999)
> Magnolia (1999)
> The Straight Story (1999)
American Beauty (1999) +
The Wind Will Carry Us (1999)
Fight Club (1999)
Not of This World (1999)
The Green Mile (1999) +
The Insider (1999)
The Iron Giant (1999)
The Matrix (1999) +
The Sixth Sense (1999)
The Third Miracle (1999)
American History X (1998)
Baraka (1998)
The Book of Life (1998)
The Last Days of Disco (1998)
Pi (1998)
Pleasantville (1998)
The Prince of Egypt (1998)
The Truman Show (1998) +
The Dreamlife of Angels (1998)
After Life (1998)
Amistad (1997)
Contact (1997)
Henry Fool (1997)
The Ice Storm (1997) +
The Sweet Hereafter (1997)
Ulee's Gold (1997) +
Life Is Beautiful (1997)
The Funeral (1996)
Sling Blade (1996) +
The Spitfire Grill (1996)
The Addiction (1995) +
Cry, the Beloved Country (1995)
Les Misérables (1995)
Amateur (1994)
Barcelona (1994)
Pulp Fiction (1994) +
The Shawshank Redemption (1994)
Three Colors: Red (1994)
Three Colors: White (1994)
Vanya on 42nd Street (1994)
Fearless (1993)
Faraway, So Close! (1993) +
Shadowlands (1993) (BBC version is better)
Bad Lieutenant (1992)
Malcolm X (1992) +
A River Runs Through It (1992) +
Unforgiven (1992) +
Black Robe (1991)
A Brief History of Time (1991)
The Fisher King (1991) +
Grand Canyon (1991)
The Rapture (1991)
2000s
> Waking Life (2001)
> The Passion of the Christ (2004)
Eternal Sunshine of the Spotless Mind (2004) +
Bruce Almighty (2003)
Dogville (2003)
Master and Commander: The Far Side of the World (2003)
Monsieur Ibrahim et les fleurs du Coran (2003)
X2 (2003)
28 Days Later... (2002)
About Schmidt (2002)
Changing Lanes (2002)
Heaven (2002)
In This World (2002)
Last Laugh (2002)
The Man Without a Past (2002)
Punch-Drunk Love (2002)
Signs (2002) +
Stevie (2002)
Thérèse: The Story of Saint Thérèse of Lisieux (2002)
A Walk to Remember (2002)
The Believer (2001)
Hell House (2001)
The Lord of the Rings (2001, 2002, 2003)
Thirteen Conversations About One Thing (2001)
To End All Wars (2001)
Wit (2001)
Code Unknown: Incomplete Tales of Several Journeys (2000)
In the Mood for Love (2000)
Gladiator (2000)
Italian for Beginners (2000)
Memento (2000) +
Milky Way (2000)
O Brother, Where Art Thou? (2000) +
Songs from the Second Floor (2000)
Unbreakable (2000)
Yi yi: A One and a Two... (2000)
You Can Count on Me (2000)
So, please take this timeline and genre considerations into consideration when selecting films for the final list.
I also notice some more glaring omissions (e.g. The Double Life of Veronique, Network)