You are being watched. CCTV cameras record your supermarket activities; your smart card tracks your trips on the subway; your employer may be reading your e-mail. Surveillance is usually associated with repressive totalitarian states, but across Europe and North America, governments have recently granted themselves new powers to snoop on civilians. Two recent films examine how individuals and societies are affected by the surveillance of their every move.

The Lives of Others, directed by Florian Henckel von Donnersmarck, takes an intimate look at life under communism in East Germany in 1984. The film's central protagonist, renowned playwright, Georg Dreyman (Sebastian Koch), is respected both in the East and the West, and his wife, Christa-Maria Sieland (Martina Gedeck), is an actress of equal distinction. At the premiere of Dreyman's latest play, however, Dreyman attracts the attention of Hauptmann Gerd Wiesler (Ulrich Mühe), a member East Germany's secret police, the Stasi. "He's too arrogant," Wiesler whispers to a colleague. "He must be dirty." Wiesler goes on to investigate Dreyman and Sieland for evidence of subversive activities.

When we meet Wiesler, he is a dour, humourless man, almost archetypal in his by-the-book loyalty. Dreyman-brooding and passionate-is his foil. Wiesler lives in a bare apartment-the epitome of Communist design; Dreyman's sprawling flat, with its overstocked bookcases and beautiful woodwork, is the kind of place you'd expect a Continental writer to inhabit. Wiesler's appearance is control embodied; Dreyman is all flowing hair and dashing overcoats. Nevertheless, the two men do have something in common: both are satisfied with their lot in life. Or so they think.

Dreyman is smart. He sees how the arrogant, self-interested East German bureaucracy has punished those of his friends and fellow artists who have ever dared speak out against the regime. He realizes that satisfying the government bigwigs allows him the freedom to live comfortably and practice his craft. Wiesler, after spying on Dreyman for many hours, realizes that the playwright will not turn against his masters. And so the agent deliberately provokes him by revealing that his wife is having a secret (although unknown to Dreyman coerced) affair with the Minister of Culture. Dreyman comes to understand the charade that is East German life and sets to work on the subversive act that Wiesler was looking for all along.

Of course, Dreyman's epiphany has an effect on Wiesler, too. Beneath the stoicism, he is a sad man, alienated from society and disillusioned by the corruption around him. One suspects that Wiesler watches others because his own life is so terribly empty. One night, after spying on Dreyman, Wiesler is greeted by a buxom prostitute, doing the rounds of the apartment building where he and many other Stasi agents live. After Wiesler and she have had sex, Wiesler buries his face in her cleavage and begs her to stay. She declines: "Next time, book me for longer." It is at this desperate point that Wiesler too rebels against the system, using Dreyman as his proxy.

Although The Lives of Others successfully reveals the extent to which East Germany was a Big Brother society, controlled by 100,000 Stasi agents and 200,000 informers, the film lacks the sustained, edgy tension you might expect from a study of surveillance. Above all, the movie is cathartic in its unflinching acknowledgement of just how frightful and frightening life was in former East Germany for a population kept in line by wiretaps, interrogation rooms and informants.

Andrea Arnold's Red Road is not nearly so neat in its conclusions. Like The Lives of Others it tackles the relationship between the watcher and the watched. Compared to its German counterpart; however, this film is darker. Set in present times, Red Road follows Jackie (Katie Dickie), a CCTV operator who spends her working day in a police control room watching a bank of television screens for signs of criminal activity in Glasgow's streets. We don't know much about Jackie. At work, she observes a cast of regulars, including a shop owner who walks his ailing old pit bull and a cleaning lady who dances jovially on the job. Her personal life is empty except for fortnightly trysts with a married colleague and infrequent, awkward encounters with estranged family members. For the most part, Jackie is silent and alone.

Then, one night, on her bank of monitors, Jackie spots a couple having sex up against a wall in a dodgy part of town. As she zooms in, her face betrays voyeuristic fascination and guilty arousal. But after finishing, the man caught on screen turns around, revealing his face to the camera, and Jackie recognizes him. She is clearly traumatized to see him and starts following the man with increasing obsession, gradually insinuating her way into his life and driving the plot to an aggressive climax.

By restricting the narration of this story to Jackie's perspective, Red Road mimics the narrow range of a CCTV camera. Jackie almost never leaves the frame, and this device is used to good effect, creating an ominous, paranoid atmosphere.

What makes Red Road a more impenetrable film than The Lives of Others is its ambiguity on the question of surveillance. Jackie is no Stasi agent; she is a sympathetic woman and her intent in observing others is not malicious. When at night she zooms in on her cast of regulars, she is both invading their privacy and protecting them. Britain, where the action is set,  is the most closely-monitored democratic country in the world-centrally-controlled CCTV cameras and other tracking devices are ubiquitous.

The Lives of Others seems to critique the current move towards heightened surveillance in the West. Clear parallels can be drawn between the wiretappings authorized by President Bush and those performed by the Stasi, between the interrogation techniques taught by Wiesler and those condoned by Vice President Cheney. Red Road, however, is more unnerving in its ambiguity. A sense of uneasiness pervades the film, based in no small part on the suspicion and paranoia wrought by constant observation. There are very few instances where that surveillance is shown to cause direct harm; rather, its effect, a slow breakdown of trust and social cohesiveness, seems to be more insidious. Trapped in the murky present, that equivocality is what makes Red Road so haunting.