To put it short, this episode is astounding. It's a classic tense horror story with a Doctor Who spin squeezed into 45 minutes. As far as scariness goes, Midnight ranks right up there with Blink and The Impossible Planet, but at the same time it's stunningly well written, brilliantly acted, and flawlessly produced.
The best thing about it is that it plays on everyone's fear of the unknown - there's SOMETHING knocking on the wall, but no-one's got any idea what, not even the Doctor. The tension starts about 10 minutes in and doesn't let up until 2 or 3 minutes from the end. While it might not have the flawless intricate detail of a Steven Moffat story, Midnight is so simple and so effective that it doesn't really matter, because it's so superb as it is that you're just transported to a world of fear where details don't matter.
A special mention must go, of course, to Lesley Sharp, for a truly unbelievable performance. This episode wouldn't have been half as scary without her acting the way that she does - you'll understand why once you've seen it. It's by far the best and the scariest "human villain" perfformance since Harry Lloyd in The Family of Blood last year.
It's episodes like this that make you a little sad that Russell T Davies is standing down, because this, along with Doomsday, is probably the best episode he's written. But at least he's being taken over by Steven Moffat. If the Silence in the Library/Forest of the Dead double header hadn't been as good as it was, this would easily be the best episode of the series.