With an emphasis on colonial India, this study analyzes British industrial and cinematic texts to argue that specific notions of the "imperial" were embedded in the definition of an emerging "national" British cinema. 1927 signaled the beginning of protective quotas in Britain, to promote British films within a domestic market that was dominated by Hollywood. The State instituted a system of film licensing to differentiate a "British" film from a "Foreign" film, necessitating the announcement of official criteria for defining a national product. Interpretations of Parliamentary debates and Bills, pamphlets of industry lobbyists, and proceedings of film enquiry committees reveal strategic inclusions and exclusions of colonial and dominion films in relation to the category of "British" films. The Britain that was in competition with Hollywood was a shifting entity, casting about for markets within a resistant empire. This cultural predicament is clarified by a theorization of the contradictions between the constructs of "empire" and democratic "nationhood," for a State and an industry that had factions with an investment in both entities by the 1930s. Linking industrial discourses to specific narrative and cinematic strategies, predominant "imaginative modes" of imperial narration are systematized. These modes exemplify cinematic practices through which ideas legitimating empire came to be accommodated with emerging twentieth century moralities. These strategies are characterized as the realist (Sanders of the River, 1935), romantic (The Drum, 1938), and modernist (Black Narcissus, 1947) modes of imperial narration, collectively demonstrating a nation in transition.