Peter Bogdanovich's "The Last Picture Show" uses the closing of the Royal Theater on Main Street in the small West Texas town Anarene to frame what happened to America in the early 1950s. The theater, pool hall, and all-night cafe supply what little excitement and community the town has.

Sam the Lion, the only self-sufficient, self-satisfied man in town, owns all three places. Without much else to do, other people fight malaise by engaging in sexual infidelity. Anarene has no dreams, no new faces, not even a football team that can tackle. Westerns ("Wagon Master" and "Red River" are among the last shows at the Royal) are being replaced by nervously hilarious TV programs from the East, and defeated housewives want to be in "Strike It Rich" audiences.

Against this backdeop, two high school seniors, Sonny and Duane, co-captains of the shameful football team, mostly live their lives in a pick-up truck and used Mercury. That was how high school was in the 1950s, and maybe always will be: A car was mobile refuge from adults, frustration, and boredom. ((During the year of the film's action, the two boys more or less survive falling in love with the school's only beauty Jacy (Shepherd), a calculating charmer who twists every boy in town around her little finger before leaving for Dallas. Sonny breaks up with his gum-chewing girlfriend and has an unresolved affair with the coach's wife, and Duane goes off to fight the Korean War. There are two deaths, but no babies born, and Bogdanovich's final pan along Main Street curiously seems to turn it from the real location it is into a backdrop of an old movie. "The Last Picture Show" is far more complex than it first seems; this shot suggests something of its buried structure. Every detail of clothing, behavior, background music, and decor is exactly right for 1951 -- but that still doesn't explain the movie's mystery.

Bogdanovich has been infinitely subtle here. The 1951 decor, and the visual style of a movie that might have been shot then: cutaway shots at a dance, an insert of Sonny's foot on the gas, black-and-white photography of real locations as if they were sets. It's as if it were the best film of 1951, and gets down to the visual level in a way that will affect audiences even if they aren't aware how, and great directing. Movies make our dreams as well as show them, and when we lose them, we lose our dreams.