As a new century unfolds, the "downsizing" and continuing marginalization of the humanities, including theatre, in American higher education correspond to three trends in the academy. First, in response to the fiscal crises that began in the late 1970s, universities have increasingly turned to the private sector for financial support as federal and state funding has been reduced. Second, universities have become progressively more market-driven, and so, commercialized. In this context, departments in the arts and humanities are often accused of losing their intellectual anchors. Third, students' intentions for the bachelor of arts degree have simultaneously shifted from developing intellectual qualities and a philosophy of life to that of preparing for economic security. As a consequence of the changing definitions of liberal arts education, subjects in the arts and humanities will have to reconsider their missions and curricular practices in order to attract students and remain relevant. (Contains 9 footnotes.)