In the last years of the 20th century and the early years of the 21st century, the idea of “synergy” dominated the motion-picture industry in the United States, and an unprecedented wave of mergers and acquisitions pursued this ultimately elusive concept. Simply put, synergy implied that consolidating related media and entertainment properties under a single umbrella could strengthen every facet of a coordinated communications empire. Motion pictures, broadcast television, cable and satellite systems, radio networks, theme parks, newspapers and magazines, book publishers, manufacturers of home entertainment products, sports teams, Internet service providers—these were among the different elements that came together in various corporate combinations under the notion that each would boost the others. News Corporation Ltd., originally an Australian media company, started the trend by acquiring Twentieth Century–Fox in 1985. The Japanese manufacturing giant Sony Corporation acquired Columbia Pictures Entertainment, Inc., from The Coca-Cola Company in 1989. Another Japanese firm, Matsushita, purchased Universal Studios (as part of Music Corporation of America, or MCA) in 1990; it then was acquired by Seagram Company Ltd. (1995), became part of Vivendi Universal Entertainment (2000), and merged with the National Broadcasting Co., Inc. (2004), a subsidiary of the Comcast Corporation. Paramount Pictures, as Paramount Communications, Inc., became part of Viacom Inc. In perhaps the most striking of all ventures, Warner Communications merged with Time Inc. to become Time Warner Inc., which in turn came together with the Internet company America Online (AOL) to form AOL Time Warner in 2001. The company then changed its name again, back to Time Warner Inc., in 2003; it was purchased by AT&T in 2018 and renamed WarnerMedia. The Disney Company itself became an acquirer, adding Miramax Films, the television network American Broadcasting Company, the cable sports network ESPN, and, in 2019, 20th Century Fox, among other properties. The volume of corporate reshuffling and realignment had an undoubted impact on the studios involved. Nevertheless, the potential for success of such synergistic entities—and, more particularly, the positive or negative effect on their motion-picture units—remained an open question.

It could well be argued, however, that motion-picture companies’ corporate links with the wider media world and emergent communications forms such as the Internet fostered receptivity to new technologies that rapidly transformed film production in the 1990s and into the 21st century. As early as 1982, the Disney film Tron made extensive use of computer-generated images, which were introduced in a short special-effects sequence in which a human character is deconstructed into electronic particles and reassembled inside a computer. A few years later computer-generated imagery was greatly facilitated when it became possible to transfer film images into a computer and manipulate them digitally. The possibilities became apparent in director James Cameron’s Terminator 2: Judgment Day (1991), in images of the shape-changing character T-1000.

In the 1990s computer-generated imagery (CGI) made rapid strides and became a standard feature not only of Hollywood action-adventure films but also of nearly any work that required special visual effects. Examples of landmark films utilizing the new technologies included Steven Spielberg’s Jurassic Park (1993); Independence Day (1996), directed by Roland Emmerich; and The Matrix (1999), written and directed by Larry (later Lana) Wachowski and Andy (later Lilly) Wachowski. In Spielberg’s film, based on a best-selling novel by Michael Crichton, a number of long-extinct dinosaur species are re-created through genetic engineering. At the special-effects firm Industrial Light and Magic, models of the dinosaurs were scanned into computers and animated realistically to produce the first computer-generated images of lifelike action, rather than fantasy scenes. In Independence Day, a film combining the science-fiction and disaster genres in which giant alien spaceships attack Earth, an air battle was programmed in a computer so that each individual aircraft maneuvered, fired its weapons, and dueled with other flying objects in intricate patterns of action that would have been too time-consuming and costly to achieve by traditional special-effects means. By the end of the 1990s, the developing new technologies were displayed perhaps more fully than ever before in the Wachowskis’ spectacular film, in which the computer functions as both a central subject and a primary visual tool. For a scene in which actor Keanu Reeves appears to be dodging bullets that pass by him in a visible slow-motion trajectory, a computer program determined what motion-picture and still images were to be photographed, and then the computer assembled the images into a complete visual sequence.

In part through the expensive and lavish effects attained through the new technologies, American cinema at the end of the 20th century sustained and even widened its domination of the world film marketplace. Domestically, the expansion of ancillary products and venues—which during the 1990s were dominated by the sale and rental of video cassettes and then DVDs for home viewing as well as by additional cable and satellite outlets for movie presentation—produced new revenues that were becoming equal to, or in some cases more important than, income from theatrical exhibition. Nevertheless, exhibition outlets continued to grow, with new “megaplex” theaters offering several dozen cinemas, while distribution strategies called for opening major commercial films on 1,000 or more—sometimes as many as 3,000 by the late 1990s—screens across the country. The competition for box-office returns became something of a spectator sport, with the media reporting every Monday on the previous weekend’s multimillion-dollar grosses and ranking the top-10 films by ticket sales. The exhibition environment seemed to demand more than ever that film production be geared to the tastes of teenage spectators who frequented the suburban mall cinemas on weekends, and commentators within the industry as well as outside it observed what they regarded as the diminished quality of mainstream films. As if reflecting that judgment, in 1996 only one major studio film, Jerry Maguire, was among the five nominees for best picture at the annual Academy of Motion Picture Arts and Sciences awards ceremony (the other nominees were an American independent film, Fargo; an Australian work, Shine; a film from Britain, Secrets & Lies; and the winner, an international production with British stars and based on a novel written by a Canadian, The English Patient).

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The motion-picture industry’s emphasis on pleasing the youth audience with special effects-laden blockbusters and genre works such as teen-oriented horror films and comedies inevitably diminished the role of directors as dominant figures in the creative process, further reducing the status that Hollywood directors had attained in the auteur-oriented 1960s and ’70s. Still, more than a handful of filmmakers, several of them veterans of that earlier era, maintained their prestige as artists practicing in a commercial medium. Two of the most prominent, who had launched their careers in the early 1970s, were Steven Spielberg and Martin Scorsese. In addition to Jurassic Park, Spielberg’s works in the 1990s included Schindler’s List (1993, winner of an Academy Award for best picture), Amistad (1997), and Saving Private Ryan (1998), with A.I. Artificial Intelligence (2001), Munich (2005), Lincoln (2012), and Bridge of Spies (2015) among his subsequent films. Scorsese directed GoodFellas (1990), The Age of Innocence (1993), Casino (1995), Kundun (1997), Gangs of New York (2002), The Departed (2006; winner of an Academy Award for best picture), and The Irishman (2019), the latter of which made use of CGI to make veteran actors look decades younger.

The actor-director Clint Eastwood was also prolific in this period, winning the best picture Academy Award with Unforgiven (1992) and directing such other films as Mystic River (2003), Million Dollar Baby (2004; Academy Award for best picture and best director), Letters from Iwo Jima (2006), Gran Torino (2008), Invictus (2009), American Sniper (2014), Sully (2016), and The Mule (2018). Stanley Kubrick died before the release of Eyes Wide Shut (1999), his first film since Full Metal Jacket (1987). Two decades passed between Terrence Malick’s Days of Heaven (1978) and The Thin Red Line (1998), but he became more prolific after the turn of the 21st century, directing The New World (2005), The Tree of Life (2011), Knight of Cups (2015), and A Hidden Life (2019).

A succeeding generation of filmmakers who could claim the status of auteur included such figures as David Lynch, Oliver Stone, James Cameron, Christopher Nolan, and Spike Lee. Lynch’s work in the 1990s and beyond included Lost Highway (1996), The Straight Story (1999), Mulholland Drive (2001), and Inland Empire (2006). Stone, best known for politically oriented films such as JFK (1991), Nixon (1995), W. (2008), and Snowden (2016), also made Natural Born Killers (1994), U-Turn (1997), Any Given Sunday (1999), and Savages (2012). Cameron’s Titanic (1997), re-creating the 1912 sinking of an ocean liner on its maiden voyage after striking an iceberg, won an Academy Award for best picture and broke domestic and worldwide box-office records. He created an immersive new world in the fantasy adventure Avatar (2009). The British-American Nolan burst onto the scene in 2000 with Memento, a mystery centring on a man with short-term memory loss, He followed up with the psychological thriller Insomnia (2002). Nolan also directed the Dark Knight trilogy (Batman Begins [2005], The Dark Knight [2008], and The Dark Knight Rises [2012]), the London-set The Prestige (2006), the science-fiction adventures Inception (2010), Interstellar (2014), and Tenet (2020) as well as the historical drama Dunkirk (2017). Lee, the most prominent among a group of young African American filmmakers who began working in mainstream cinema in the 1980s, was best known for Do the Right Thing (1989) and Malcolm X (1992). His many other films included Crooklyn (1994), Summer of Sam (1999), BlacKkKlansman (2018), and Da 5 Bloods (2020), along with documentaries such as 4 Little Girls (1997), concerning the deaths of four young Black girls in the bombing of a Birmingham, Alabama, church in 1963, and When the Levees Broke (2006), about New Orleans during and after Hurricane Katrina. Among newcomers who emerged during the 1990s, Paul Thomas Anderson stood out with Boogie Nights (1997), Magnolia (1999), Punch-Drunk Love (2002), There Will Be Blood (2008), The Master (2012), and Phantom Thread (2017). Also notable were Wes Anderson, director of Rushmore (1998), The Royal Tenenbaums (2001), Moonrise Kingdom (2012), and The Grand Budapest Hotel (2014); and David Fincher, whose films included Fight Club (1999), Panic Room (2002), The Curious Case of Benjamin Button (2008), The Social Network (2010), Gone Girl (2014), and Mank (2020).

A notable development in American cinema was the rise of significant female filmmakers, including Kathryn Bigelow, Patty Jenkins, Sofia Coppola, and Greta Gerwig. Bigelow’s films included the cult-classic vampire movie Near Dark (1987); the police thriller Blue Steel (1989); Point Break (1991), about an undercover FBI agent; and the science-fiction drama Strange Days (1995). Her accomplished Iraq War drama The Hurt Locker (2008) made her the first woman to win an Academy Award for best director, and it also received an Oscar for best picture. Her later movies included Zero Dark Thirty (2012), about the hunt for Osama bin Laden, and Detroit (2017), focusing on the city’s 1967 riots. While Bigelow acquitted herself as a master of action pictures, Jenkins staked out a claim on superhero movies. She made her debut with Monster (2003), about serial killer Aileen Wuornos, but her best-known films were Wonder Woman (2017) and Wonder Woman 1984 (2020), both starring Gal Gadot. Coppola, the daughter of Francis Ford Coppola, made her feature film debut with The Virgin Suicides (1999), a drama about loss of innocence. Her screenplay for Lost in Translation (2003) earned her an Oscar, and she became the first American woman to be nominated for best director. Somewhere (2010) received the Golden Lion for best film at Venice, and Coppola took the award for best director at Cannes for her Civil War thriller The Beguiled (2017). Gerwig was an actor as well as filmmaker. After codirecting Nights and Weekends (2008), about a long-distance romance, she debuted as a solo director with the coming-of-age story Lady Bird (2017), for which she received Oscar nominations for both screenwriting and direction. She also garnered praise for Little Women (2019), based on the Louisa May Alcott novel. Her comedy-fantasy film Barbie (2023), cowritten with Noah Baumbach, broke box office records to become the highest grossing film in history by a solo female director. Other notable women directors included Lynn Ramsay, Lulu Wang, and Ava DuVernay, the latter of whom directed the acclaimed civil rights movement film Selma (2014).

Another significant development in late 20th-century American cinema was the emergence of a self-designated independent film movement. Its origins perhaps lay in the perceived diminution of opportunities for personal filmmaking in the post-1970s commercial industry. To take up the slack, organizations such as the Independent Feature Project and the Sundance Film Festival in Park City, Utah, were founded to encourage and promote independent work. A major breakthrough was achieved when an American independent film, sex, lies and videotape (1989), the first feature by Steven Soderbergh, won the top prize at the Cannes festival in France. (Soderbergh went on, like Spike Lee and others, to work on both independent and mainstream projects; he won an Academy Award as best director for Traffic [2000].) In the 1990s independent directors began to develop projects that were closer in style to popular Hollywood genres such as the gangster film and post-World War II film noir. These proved exceedingly popular with Cannes festival juries, who awarded their top prize to David Lynch’s Wild at Heart in 1990, Barton Fink by the Coen brothers in 1991, and Quentin Tarantino’s Pulp Fiction in 1994. Tarantino’s other films included Reservoir Dogs (1992), Jackie Brown (1997), Kill Bill: Vol. 1 (2003), Kill Bill: Vol. 2 (2004), Inglourious Basterds (2009), Django Unchained (2012), The Hateful Eight (2015), and Once Upon a Time…in Hollywood (2019). Among the Coen brothers’ works were Miller’s Crossing (1990), Fargo (1995), The Big Lebowski (1998), O Brother, Where Art Thou? (2000), The Man Who Wasn’t There (2001), No Country for Old Men (2007; Academy Award for best picture), True Grit (2010), Inside Llewyn Davis (2013), and The Ballad of Buster Scruggs (2018).

Beyond this genre orientation, which cemented the popularity of independent films for many in the mainstream audience, the independent movement fostered what came to be called niche filmmaking, which generated works growing out of ethnic and identity movements in contemporary American culture. Among these were films by African American, Native American, and Latinx filmmakers, as well as works representing feminist and gay and lesbian cultural viewpoints and experience. African American director Barry Jenkins’s Moonlight (2016), with an all-Black cast and an LGBTQ main character, won an Oscar for best picture. Jordan Peele brilliantly addressed racism in the horror movies Get Out (2017), for which he won a screenwriting Oscar, and Us (2019). Other movies from this category included Sterlin Harjo’s Four Sheets to the Wind (2007), Miguel Arteta’s Beatriz at Dinner (2017), and Luca Guadagnino’s Call Me by Your Name (2017).

Documentary filmmaking from these and other perspectives also thrived in the independent world. Independent nonfiction films of significance included Errol Morris’s The Thin Blue Line (1988), an exploration of a miscarriage of justice in a Dallas murder case; Hoop Dreams (1994), by Steve James, Frederick Marx, and Peter Gilbert, concerning the struggles of two young African American basketball hopefuls in Chicago; Crumb (1994), Terry Zwigoff’s portrait of the underground comic book artist Robert Crumb; Buena Vista Social Club (1999), Wim Wenders and Ry Cooder’s rediscovery of old-time popular Cuban musicians; Bowling for Columbine (2002), Michael Moore’s examination of the American propensity for gun violence; The Central Park Five (2012), an examination by Ken Burns, Sarah Burns, and David McMahon of a 1989 case in which several Black and Latino teenagers were wrongly convicted for the rape of a white woman; and 20 Feet from Stardom, (2013), Morgan Neville’s exploration of the lives of backup singers.