(FORTUNE Magazine) – Spotlights pan the sky, and the line of smartly dressed patrons weaves outside a glittering movie theatre. Six new BMW 745LIs slowly come to a stop as celebrities, executives, and other VIPs spill out onto the crowded street. Sound like a scene from Cannes or Sundance? Nope, it's the Urbanworld Film Festival.

Ethnic-oriented film festivals are suddenly among the hottest ways for advertisers to reach young professional urbanites with rising disposable incomes. This year alone BMW, McDonald's, Ford, Bank One, Corona, American Airlines, Nordstrom, and Hamilton Watch have sponsored ethnic festivals. "Now we only beg for money half the time," says Stacy Spikes, founder and chairman of Urbanworld, the largest international competition aimed at an urban market. "Corporations are coming to us. It's like everyone woke up and realized this is the future. Miss out now, and you've lost them as a customer forever."

Spikes, 35, a former VP of marketing at Miramax, began the festival with Vibe Magazine in August 1997 with 35 films and only one screen. That year recording artist Kenneth "Babyface" Edmonds showed up as a last-minute entry with his independent project Soul Food. A month later, during its opening weekend, Soul Food was No. 3 at the box office, giving Urbanworld credence as a testing ground for movie studios. This year the festival, whose advisory board includes Samuel L. Jackson, Danny Glover, Wesley Snipes, and Debbie Allen, featured 63 films.

Latino film festivals have seen similar popularity surges. Sponsorship dollars increased 200% in the past three years, according to Richard Tuchman, CEO of TSE Sports & Entertainment, a marketing consultancy in New York City. Chicago's Latino Film Festival now charges $200,000 for a "presenting" level sponsorship; Tuchman says the slot at similar festivals fetched less than half that two years ago.

Why all the interest? According to research by the Selig Center for Economic Growth, the spending power of African Americans is projected to almost double by 2008, to $921 billion; Latino spending is projected to grow 357%, to more than $1 trillion. During the same period, according to the Selig Center's research, the buying power of whites will increase by just 128%. It also helps that black films like Barbershop and How Stella Got Her Groove Back, which both premiered at Urbanworld, went on to become mainstream hits.

"Stacy brings us to a very important audience in a developing genre of films, and we want to get in early," says Jim McDowell, VP of marketing at BMW North America. Spikes is talking to HBO about televising the festival on cable, a la Sundance, and he also wants to schedule screenings for corporations and take the show on the road to college campuses. Look for Spikes to be playing soon at a theater near you. --Kimberly L. Allers