In the 1890s a couple of hundred paintings were sent up each year by special train to the Royal Academy exhibition from the artists’ colonies of St Ives and Newlyn. This year the works from Cornwall numbered 12 – and four of those were by Sandra Blow, who died last year. Is Cornwall – once pellucid inspiration to Alfred Wallis, Ben Nicholson and Barbara Hepworth – dead as a haven for artists? I took the train to Penzance to find out.

Even the flagship Tate St Ives is showing signs of panic. Since opening in 1993, it has proudly flown the flag of British Modernism from the tower of its converted gas works overlooking Porthmeor Beach. But the passing of the “St Ives Moderns” – Terry Frost in 2003, Wilhelmina Barns-Graham in 2004, Karl Weschke in 2005 and Sandra Blow in 2006 – has hit its programming. Only Paul Feiler and Trevor Bell remain.

This spring the Tate made a bid to break new ground with an exhibition of young local talents entitled Art Now Cornwall. But its controversial selection of 28 artists from a shortlist of just 40 – drawn up by the outgoing director Susan Daniel-McElroy – was an uneasy mix of experimental mixed-media work and third generation “St Ives legacy” painting. “Perhaps that reflects where we’re at,” the gallery’s new executive director Mark Osterfield suggested. “How much are people looking back, and how much are they looking forward?”

Wherever people are looking, there’s a lot to see. There are more than 60 commercial galleries in St Ives alone, with a newly refurbished one, the Wills Lane Gallery, opening on September 17 under the discerning direction of Petronilla Silver, Weschke’s widow and a former director of the Contemporary Art Society. Six miles away in Penzance, galleries have been sprouting like mushrooms in the shadow of The Exchange, the snazzy new contemporary art space in the town’s converted telephone exchange whose July opening was attended by more than 2,000 people, including Sir Nicholas Serota.

In the past year, four new commercial galleries have sprung up within 50 yards. The newest, Hilton Young Fine Art, with a double frontage on historic Chapel Street, was opened in July by Bo Hilton, son of Roger, and declares its dynastic St Ives credentials with a painting by Bo’s mother Rose Hilton in one window and a print by Sandra Blow in the other.

So far, so predictable. But the gallery that has brought me to Chapel Street is rather special. Occupying modest premises opposite, Goldfish Contemporary Fine Art was opened three years ago by the self-taught painter Joseph Clarke, who came to Cornwall “to escape from real life” and has a taste for like-minded artists who gravitated here in search of asylum.

The work of artists like Andrew Litten, Ray Exworth and Kate Walters stands outside the St Ives abstract tradition. It is figurative, introspective and raw: to use Clarke’s favourite adjective, “primitive”. And its collectors are not all local. At the Goldfish stand at this year’s London Art Fair, the big-time Scottish collector David Roberts bought a 10ft sculpture of a priapic Silenus ( left) by the Fowey-based sculptor Tim Shaw.

Clarke’s passion for art is matched by a gift for self-publicity. When Tate St Ives mounted its exhibition, Art Now Cornwall,Clarke countered with his alternative, Art Now Cornwall? Next thing he knew, the critic Brian Sewell had stumbled into his gallery and announced, during a one-man tirade against the Tate’s show [[ – and St Ives art in general – at the Acorn Theatre, Penzance, that the work he’d seen at Goldfish knocked the spots off anything he’d seen in London for years. Sewell will be back in Cornwall by popular demand for a repeat performance at the St Ives Theatre on September 22.

Whom to believe? At the New Millennium Gallery, St Ives, which contributed six artists to the Tate show – including the Penzance-born painter and transatlantic yachtsman Sax Impey, who is currently exhibiting there – the local dealer David Falconer feels the Tate mishandled things: “If you call a show Art Now Cornwall, you have to take greater steps to allow everyone to submit.”

In the avant-garde camp, there was also resentment at the Tate’s surprised “discovery” of the thriving independent art scene on its doorstep. For the past few years, enterprising artist-led groups such as Art Surgery – founded by Andy Whall, whose underwater video work In an Atlantic Wave featured in Art Now Cornwall – and More Cornwall have been staging experimental projects in alternative spaces and meeting with an enthusiastic reception.

In the county with the highest density of artists in England, one unique feature of the art scene is the mix. Performance artists like Whall find themselves “rubbing up against people who are banging on about Cézanne and plein air painting. It wouldn’t happen in a bar in Hoxton”.

At the Salt Gallery in Hayle, a commercial gallery with a mini-installation space tacked on, the artist-founders Marilyn Middlemiss and Louise Fox have had surprising success in attracting a local audience. Their secret is a down-to-earth approach – “It’s no good putting on stuff that’s up its own bottom” – coupled with a free-and-easy attitude to presentation. When the local artist Lucy Willow laid a yellow pigment carpet in their Front Room for her May show Canaries in the Attic, it was not roped off. In Art Now Cornwall, Willow’s Celestial Dust Rug – a piece about impermanence – was placed on a plinth.

Since migrating here from Hackney, East London, eight years ago, Middlemiss and Fox have noticed a sea change in the contemporary art scene.

James Green, new young director of the redeveloped Newlyn Art Gallery and The Exchange, agrees. Coming here from the NorthWest, he feels that Cornwall’s art scene is completely comparable to that of Manchester or Liverpool, and he generously credits local artist-led groups with preparing the ground for public galleries such as Newlyn.

He’s open to the idea of exhibiting local artists who operate outside the St Ives tradition, making “work that could be shown anywhere”, such as Willow or the young painter Jesse Leroy Smith, a Goldfish artist and one of the few from Cornwall to get into this year’s RA Summer Exhibition.

Tate St Ives seems warier of local involvement. Its artistic director Martin Clark speaks in general terms of “repositioning St Ives as a forward-looking art location”. He is more concerned with bringing national names to Cornish audiences than Cornish names to national notice. But the Tate is backing a regional campaign to nominate Cornwall as Europe’s first Region for Culture in 2012.

Later this month, representatives from Cornwall Arts Marketing go to Brussels to drum up support. At home, their plans are greeted with a mixture of scepticism and hope. “A lot of European money has been poured in here,” says Petronilla Silver. “There’s not a lot of quality control, but if you chuck money, some of it will stick on stuff that’s interesting or important.”

Others fear the money will go to fatten arts organisations, while the grassroots starve. Then again, artists who choose to bury themselves in the depths of the poorest county in England are unlikely to be in it for the money. I ask Whall what could be the campaign’s worst outcome. “Hot air, I suppose,” is his reply.

ST IVES: TRIUMPHS AND TAT

Since the Victorian heyday of the Newlyn School, when paintings of fisherfolk by Stanhope Forbes and his followers sold like hot kippers to London collectors, the fortunes of Cornwall’s artists have fluctuated. In the 1940s, they crested a second wave under the avant-garde helmsmanship of Ben Nicholson and Barbara Hepworth ( below), who put St Ives on the international art map.

To the casual wanderer down Fore Street towards Porthmeor and Back Road West, once home to the legendary Alfred Wallis, all the tide seems to have left behind is a line of tourist shops selling cod St Ives School paintings. The critic Waldemar Januszczak wrote recently: “St Ives today is a momentously false experience, with only the Tate enclave offering any serious resistance to the relentless gale of tat.”

Now, perhaps, a fresh wave of change is gathering force.

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