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The Sundance Film Festival has officially institutionalized its focus on artificial intelligence for the 2025 and 2026 seasons, introducing formalized 'Interest Tracks' like 'Test Your Tech' and the 'Sundance Institute AI Interdisciplinary Initiative.' This move signals a transition from treating AI as an experimental novelty in the 'New Frontier' section to acknowledging it as a pervasive, foundational tool across all cinematic categories, from documentary to dramatic competition. However, this debut arrives during a period of peak industry volatility following the historic WGA and SAG-AFTRA strikes, which were largely fought over AI protections, creating a palpable friction between the festival's mission of creative discovery and the labor force's fear of replacement.This report analyzes the technological and programmatic shift at Sundance, highlighting key premieres such as 'The AI Doc: Or How I Became an Apocaloptimist' and the interactive 'Being (The Digital Griot).' It examines the evolving submission policies that now mandate transparency regarding generative AI use, and the broader industry tensions characterized by audience walkouts and vocal resistance from cinematic purists. As Sundance balances its legacy of independent human-led storytelling with the 'democratization' offered by generative tools, the festival has become a primary battlefield for the future of artistic authorship in the digital age.