Art centres fulfil many functions in remote regions as a source of Indigenous identity and creativity; as a link to the global art market; as centres for community engagement and participation; and as a source of social capital providing a range of services for local communities. They are dependent on funding from State and Federal authorities and they are identified as one of the success stories in remote community development. However, they face an uncertain future in the light of their multiple functions and their position as both a source of traditional identity and a link to an external art market. The article highlights the challenges faced by government in the evaluation of their effectiveness and contribution; and in particular discusses the suitability of the hybrid economy model as a representation of their functions.