By KIRK SEMPLE BEIJING

OVER the course of six years Zhao Dayong, an independent filmmaker from Guangzhou, China, spent many months living among the residents of Zhiziluo, an impoverished and forgotten village in the rugged mountains near the Myanmar border, and filming their lives.

Using his own money and simple digital filmmaking equipment he made “Ghost Town,” a quiet, hypnotizing, three-hour documentary that provides an extraordinary and intimate portrait of Chinese life.

Like independent filmmakers everywhere, Mr. Zhao worked with no guarantee of an audience, or even a place to show his work. By his estimates only a few thousand people have seen “Ghost Town” in China since he finished it last year. Several hundred more are scheduled to see it Sunday afternoon when the film has its international premiere at the New York Film Festival.

But what makes Mr. Zhao’s commitment particularly noteworthy is that his project was apparently illegal.

The Chinese government has decreed that all films must be approved by government censors before being distributed and screened, including in overseas film festivals.

Mr. Zhao, 39, said getting the approval of the censors was never a consideration. “It’s like asking to be raped,” he said this month in an interview here. “The government certainly has its own agenda. They want us to stop. But at the same time we know we’re doing something meaningful.”

This mixture of defiance and principle defines China’s nascent yet highly dynamic crop of independent filmmakers who pursue their art in apparent violation of the law.

For decades the Chinese government had nearly full control over all aspects of the film industry, from celluloid filmmaking technology to financing to distribution and screening. An underground filmmaking subculture emerged in China in the late 1980s, but it began to flourish only about a decade ago with the advent of inexpensive digital cameras and postproduction computer programs that helped put filmmaking further out of reach of the government authorities.

Many of this latest generation of Chinese filmmakers have no formal film training and shoot on minimal budgets, often with small crews, or alone. Ying Liang, whose films have won numerous prizes on the international circuit, shot his widely celebrated debut film, “Taking Father Home,” using a borrowed camera. Relatives and friends were his cast and crew.

“Unlike in previous generations, the stars of this generation are not only Beijing Film Academy graduates,” said Karin Chien, a film producer in New York and president of dGenerate Films, a company she founded last year to distribute this new crop of independent Chinese films outside China. “They’re journalists, they work at television stations, they’re painters, they’re people who just picked up a camera and made a film for $1,000.”

Output is still small. Several leading filmmakers put the annual production of unsanctioned, independent films at fewer than 200. But this work has provided unusual ground-level views of China that possess an unvarnished authenticity often missing from mainstream, government-sanctioned films.

“There’s been an extraordinary explosion of young filmmakers — quite a few of them are quite talented — who are dedicated to record and tell the real story of what’s going on in China,” said Richard Peña, program director for the Film Society of Lincoln Center, which produces the New York Film Festival. “That story is really more fascinating than the story that the regime wanted to be told.”

These achievements have come at a price.

About 20 filmmakers have been banned from making films for two to five years, according to Zhang Xianmin, an independent film producer and a professor at the Beijing Film Academy. Others have received intimidating phone calls, had tapes confiscated or been detained and interrogated.

But according to several filmmakers and film scholars both here and abroad, the government recently appears to have adopted a somewhat hands-off, though highly watchful, posture toward this film vanguard, leaving it to operate in an undefined gray area.

It seems that as long as certain incendiary topics are not broached — among them the Tiananmen Square massacre, Tibet, the Cultural Revolution, the outlawed religious group Falun Gong — then independent filmmakers are allowed to work.

Yet no one is absolutely sure where the boundaries are, or whether the government will start to clamp down more fiercely.

“You don’t know where that limit is,” said Zhang Yaxuan, a critic and documentary filmmaker who is organizing an independent film archive for the Iberia Center for Contemporary Art in Beijing. “You have to try to touch it. In the process of trying, you know.”

Huang Wenhai, a documentary filmmaker in Beijing, said that the process of filmmaking here “is the process of conquering your fear.”

Despite this pressure and uncertainty, there are now at least four major independent film festivals around the country and at least two theaters, both small, dedicated to showing Chinese independent films.

Meanwhile Chinese audiences largely remain out of reach. With cinemas and television off limits to their unsanctioned films, independent moviemakers are mostly restricted to screenings in front of small audiences in art galleries, bars, universities and homes.

As a result the most accomplished filmmakers have found their largest audiences overseas, especially at international film festivals.

“I feel very frustrated,” Mr. Zhao said. “I’m a Chinese filmmaker, and of course my audience should be the Chinese people, especially since my films are about ordinary working Chinese people.” He added, “That would be more valuable than winning an international film festival.”

Mr. Zhao began his career in the fine arts. He studied oil painting at an art academy before dropping out and working as a professional artist and advertising director in Beijing and Guangzhou. He eventually founded his own advertising firm as well as a journal for contemporary arts, and he opened a gallery in Shanghai.

His first documentary was “Street Life,” a portrait of recyclers on the streets of Shanghai, which had its premiere at the Viennale in Austria in 2006. “Ghost Town,” his second film, is a series of vignettes and scenes that explore the economic struggles, religious beliefs and relationships of the residents of Zhiziluo, which had once been a local county seat for the Communist Party but was largely abandoned by the government.

Mr. Peña said he had heard about the film for some time but finally viewed it in the 11th hour of the festival’s film-selection process. “It’s one of those films that, when we saw it, there was little question in our minds that it should be included,” he said. “Ghost Town” is the first documentary from China’s new generation of digital independent filmmakers to be included in the New York festival.

Mr. Zhao, who continues to support himself by shooting television advertisements, said he had no illusions that his films would ever make him much money.

“For me, making films is a way of life, not the means to it,” he said. “And I really enjoy this life.”

Zhang Jing contributed research.

As the BFI celebrates 20 years since the release of Spike Lee's seminal film with The Independent Interview and a season of movies on the Southbank, the director talks to Kaleem Aftab about race and retrospectives

Spike Lee arrives at the BFI Southbank on Monday as part of a celebration of Do The Right Thing, his third film, which premiered at the Cannes film festival in 1989. In the two decades since then, the film has been recognised by the American Film Institute as one of the greatest 100 American movies in film history and was highly listed in a Sight and Sound Poll of the best films of the past 25 years. It was also, as Barack Obama coyly admitted last year, the movie that the President of the United States of America took Michelle to see on their first date. All in all, a far cry from the divisions and debate that the race drama provoked on its release.

It was the most controversial and discussed film of that summer. You couldn't pick up a magazine or newspaper without someone having an opinion on the Brooklyn tale or the director. Critics David Denby in New York Magazine and Richard Corliss in Time argued that Do The Right Thing was of no value except as agitprop to incite the black community to riot. In the opposite corner was Roger Ebert who wrote that "it comes closer to reflecting the current state of race relations in America than any other movie of our time".

It's not to belittle Lee's other films, including Malcolm X or Inside Man, or his two great documentaries 4 Little Girls about the 1963 church bombing in Birmingham, Alabama and the Katrina documentary When the Levees Broke, to state that Do The Right Thing remains the key work in his oeuvre. The director would never admit that it's his best film. "My films are like my children", he says. "I don't have a favourite." Yet in all the literature that Lee approves, from the children's book he wrote with his lawyer-turned-writer wife Tonya, Please, Baby, Please to the blurbs on the back of DVDs, it's always Do The Right Thing that is given the status of first among equals.

By SARAH MCBRIDE, JESSICA E. VASCELLARO and SAM SCHECHNER

Google Inc.'s YouTube is in discussions with major movie studios about streaming movies on a rental basis, a test of whether the online video giant can persuade its millions of users to pay for premium content. For Hollywood, the move could represent a bold attempt to offset its dwindling DVD sales with online revenue.

YouTube is talking to Lions Gate Entertainment Corp., Sony Corp., Metro-Goldwyn-Mayer Inc. and Time Warner Inc.'s Warner Bros. about charging for new titles on the existing YouTube site. In some cases, these titles might be available on the site on the same day that they come out on DVD.

Some studios already make full-length movies available on YouTube free, though they tend to be older, lesser-known films. It is unclear to what extent older movies or television shows will be a part of the new agreements.

While details vary from studio to studio, generally speaking the agreements would allow consumers to stream movies on a rental basis for a fee. However, in some cases, the movies could be available in way that they have been previously -- free, with advertising.

Negotiations are continuing and there are no guarantees the deals will be struck. Many details remain in flux, including whether users will eventually be able to download movies. People familiar with the matter say that new movie rentals are likely to be around $3.99, the price Apple Inc.'s iTunes Store charges for new movie rentals. The companies hope to keep pricing on par with what consumers pay for video-on-demand for new titles, these people say.

In a statement, a YouTube spokesman said the company is always working to expand on "its great relationships with movie studios and on the selection and types of videos we offer our community."

The talks are a sign of how YouTube is emerging as a competitor to a broad spectrum of entertainment outlets, including Blockbuster Inc. and Netflix Inc. as well as iTunes and Amazon.com Inc. The Hulu LLC joint venture and Sony's Crackle allow users to watch full-length movies free, but don't generally include new releases. Hulu is a joint venture of General Electric Co.'s NBC Universal, News Corp. and Walt Disney Co.

YouTube began as a place for scrappy, home-grown videos, but it has become increasingly aggressive in striking deals to host television shows, movies and other professional content as a way to draw in advertisers and viewers. But movie studios and TV networks won't give up their most popular content for a share of advertising, which they complain isn't sufficient. The negotiations with the studios are part of an effort to open up new revenue streams by charging users themselves.

Hollywood has also been eager to distribute more of its films online -- as long as it can collect a reasonable fee. Though many studios now sell and rent movies online through services such as iTunes and Amazon.com, that has yet to produce meaningful revenue. By cutting a deal with YouTube, which had nearly 428 million global visitors in June, according to comScore, it can potentially reach a much wider audience.

Studios have been pursuing these kinds of deals with renewed urgency, as revenue from DVD sales has eroded more quickly than they had anticipated. Adams Media Research says studio revenue from DVD sales should fall by about $850 million this year to $12.9 billion.

However, YouTube users aren't accustomed to opening their wallets to watch videos. And the full-length movies that already exist on the service -- ranging from classics such as the 1940 "His Girl Friday" to more recent movies like the 1999 horror flick "House on Haunted Hill" -- have drawn a modest number of views compared to content like comedy clips and music videos. Many consumers balk at watching full-length films on a computer screen.

You Tube and the studios are still hashing out how to divide revenue from the new arrangement. For deals that involve advertising, YouTube is likely to give partners the majority of the revenue, as it has done with other partners in the past. Some deals may also guarantee the studio a minimum fee per title viewed, in some cases just under $3, according to people familiar with the matter.

YouTube is pressing studios to allow the movies to be streamed on mobile devices, but some of the studios are resisting, even though that is currently allowed under other online rental services such as iTunes.

Under current plans, 10,000 Google employees will test the service for a period of three months, people familiar with the matter said. The trial was supposed to start at the beginning of September, but was pushed back as studio negotiations dragged on.