The black hole model for AGN activity has been successful and popular for over three decades. It has withstood the test of time not - at least until recently - because the empirical evidence for BHs has been overwhelming but because the alternatives are so implausible. Now progress has advanced on several fronts. The refurbished HST has greatly strengthened the evidence, already growing from ground-based observations, that supermassive dark objects live at the centers of most galaxies. The pace of discoveries is accelerating. The dark objects have exactly the range of masses that we need to explain AGN engines, but we have had no proof that they must be black holes. Then radio interferometry revealed the spectacular maser disk in NGC 4258. For its rotation curve to be as accurately Keplerian as we observe, the central mass must be confined to an astonishingly tiny volume. The inferred density of the central object is so high that astrophysically plausible alternatives can be excluded; a BH is the best explanation. The same conclusion has been reached for the BH candidate at the center of our Galaxy. This is a major conceptual breakthrough.
In addition, ASCA has demonstrated that many AGNs show iron emission lines with relativistically broadened profiles. This is arguably the best evidence for the strong gravitational field of a black hole. One of the most interesting prospects for the future is time-resolved X-ray spectroscopy, because hot gas probes closest to an accreting black hole.
Finally, the AGN paradigm can be turned inside-out to give what may prove to be the most direct argument for black holes. BHs were ``invented'' to explain nuclear activity in galaxies. In recent years, an ironic situation has developed: some BH candidates are too inactive for the amount of matter that we believe they are accreting. The same is true of some stellar-mass black hole candidates that accrete gas from evolving companion stars. A number of researchers recently have developed a theory of ``advection-dominated accretion'' in which the accretion disk cannot radiate most of its energy before it reaches RS either because it is optically thick or because it is too thin to cool. Unless most of the inflowing material ultimately escapes through an outflow, a possibility being explored, the only way to make the accretion energy disappear is to ensure that the accreting body does not have a hard surface. That is, the inactivity of well-fed nuclear engines may be evidence that they have event horizons. Finding event horizons would be definitive proof that AGN engines are black holes.