This is the story of one decade in the 100-year life of a cultural industry, with multiple perspectives (women, men, class, race, sexual plurality, Europe, Hollywood) overlapping with various aspects of the industry (distribution, experimentation, internationalisation, government policies). There are acknowledged gaps - animation, documentary, comedy - but it is a strong collection of individual voices focusing on a fascinating and complex decade.

For Britain's fragile, under-capitalised film-making community, inhabited by what Geoffrey Macnab describes here as "speculators operating on the Micawber-like principle that something would turn up", the decade opened with a period of gloom bordering on despair. In government was Nicholas Ridley, a secretary of state who, in David Puttnam's view, gave the impression "that he would regard his greatest success at the Department of Trade and Industry if he could close the British film industry down". In 1997, the incoming secretary of state for culture, Chris Smith, acknowledged what his Tory predecessors were blind to "a very simple fact about movie-making: that it is both a cultural and an economic activity". The decade closed with the imminent launch of the Film Council, a well-resourced body charged with developing a national industrial and cultural strategy. And along the way it bore witness to a flowering of talent which, if it can be sustained, has the potential to shape how others view us, to shape how we view ourselves, for generations to come.

It was the decade of Trainspotting and Sense and Sensibility (polar opposites, released on the same day), The Full Monty and Four Weddings and a Funeral ; of the flowering of middle-period (we hope) Ken Loach and Mike Leigh; of controversial low-budget gems from the BFI such as Stella Does Tricks , Love Is the Devil and Under the Skin ; of the slick Sliding Doors and Notting Hill , of the raw power of Nil by Mouth and The War Zone ; of the Oscar-winning work from Aardman Animation, of the subversive costume drama of Shakespeare in Love , Mrs Brown , Elizabeth and Jude ; of Spice World and Bean (derided by the more fastidious critics, but essential in any discussion of the economic viability of the industry); and of the style-and-violence school of Lock, Stock and Two Smoking Barrels .

It was the decade in which the cinematic talents of Michael Winterbottom, Lynne Ramsey, Mark Herman, Udayan Prasad, John Madden, Gillies MacKinnon, Shane Meadows and others emerged. It was the decade in which London became the world's leading centre outside Hollywood for digital post-production and special effects. And of course it was the decade of the National Lottery. The decision to award franchises for guaranteed production finance (currently at their mid-way point) had one particularly significant effect. In Puttnam's words: "This extraordinarily fractious industry was, for the first time in the 25 years I've been in it, obliged to analyse its strengths and weaknesses and work out how it would structure itself in the event that it was allowed to behave like a proper industry."

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It is hardly surprising, therefore, that editor Robert Murphy feels able to conclude (with caveats) that "not since the late 1950s have we reached the end of a decade when it was possible to look forward to things getting better rather than worse".

And yet there are worrying signs. As Murphy usefully reminds us, the government's natural desire to tidy up the industry "ignores the fact that creative waves of film-making - Italian Neo-Realism, the New Wave - come from the sort of chaotic, small-scale set-up which at the moment characterises British film production". Other contributors point to a damaging imbalance in the availability of development and production funding. And, as Karen Alexander rightly complains, the Britain that is being disseminated on cinema screens is overwhelmingly white: "Until Cool Britannia can acknowledge the visibility of others... the idea that the nation has of itself, namely that Britishness is something to aspire to, is under threat... we want to be celebrated, not dismissed." And, affecting everything else are the intertwined issues of distribution and of Britain's unique, productive and often inhibiting involvement with Hollywood.

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The multiplex revolution in Britain has been an American one. That much is clear. It is currently easier to make a feature film in Britain than to get it into a cinema. Smaller films and smaller distributors are gradually being squeezed out of the market. Many of the contributors to this book share a very real concern that our own film culture is becoming more commercial and less adventurous, that we are limiting our future possibilities, and that the only model for emerging film-makers will be what can be marketed and sold. The decisions of the Film Council, as it develops its funding strategies over the next 12 months, will have far-reaching effects. Their task is not simply to help build and sustain a successful film industry, but above all a successful British film industry,and all that that implies in terms of national identity and social and cultural diversity.

Paul Howson is director of film and television, British Council.