Can it really be true that a halfway decent new British film has been released? And one about gangsters as well, a genre which has exposed like no other the fatuity, cluelessness and onanism of our bright young British movie stars? Incredibly, yes it can. Just when the talentless lottery gangster film has pretty well become a contemporary cultural crisis, director Paul McGuigan comes along with Gangster No 1, a tough 60s-set thriller: plausible and sure-footed, a film with a canny yet appalled sense of the repulsive realities of crime and the unlovely, unfunny people involved in it. It is scorchingly violent, sinister, with a strange undertow of melodrama and self-loathing.

Malcolm McDowell is an ageing mobster and sociopathically nasty piece of work glimpsed first at a gruesome black-tie boxing event; he hears that an old business associate, one Freddie Mays, is to be released from prison after nearly 30 years. This leads to a long flashback of his and Freddie's early days in the bi-polar gangland of 60s London: the twin turfs of the East End and Soho. David Thewlis is the fastidious, dandyish Mays and Paul Bettany is McDowell's younger self, clean-cut, sinisterly handsome, turned out with fanatical care, and impressively resembling the young Michael Caine in his fiercely serious mode - checking out his reflection in the mirrors of tallboys and the backs of ashtrays.

"Gangster lean" is an evocative New York phrase noted by Susanna Moore in her novel In the Cut, meaning a special wiseguy way of leaning or lounging in a car; the principals and supporting cast alike are giving it plenty of lean here; the phrase came into my head watching them leaning in their clubs and bars, their Dolomites, Rovers and E-types. 

Gangster No 1 has a strong sense of the geography and furnishings of this period: the occult markings of London transcribed by writers like Iain Sinclair and Jake Arnott. Freddie himself lives in an outrageously fancy 60s apartment - impressively reconstructed - in which he is wont to relax with a drink from the sideboard and Matt Monro on the turntable. But we are never invited to luxuriate in retro naff: what is important is shabbiness, and sadness.

Even people who profess to be gangster cognoscenti are sometimes vague about what real gangsters actually do on a day-by-day, hour-by-hour basis to get their money. (In his Adventures In The Screen Trade, William Goldman famously denounced "cute Mafia chieftains" in supposedly realistic dramas like The Godfather: "Try asking a major star to play a real Mafia head, a man who makes his living off whores and child pornography, heroin and blood.") There is some residual cuteness in Gangster No 1, but Paul McGuigan certainly jettisons the tiresome Lock, Stock sense that gangsters are adorable stand-up comedy merchants with the gift of the gab.

As the young gangster, Paul Bettany is an unpleasant inadequate: convulsed with envy for what he imagines is Mays' mastery of the good life, neurotically concerned with imitating his boss's snappy suits, and ferociously unpleasant to Mays' fiancée Karen (Saffron Burrows) - thus sublimating homoerotic impulses into weirdly impotent nastiness. All the bigotry and sheer ugliness of gangsterism that was airbrushed away in inanities like Love, Honour and Obey are here in abundance.

McGuigan's central scene is the young gangster's orgy of sadistic violence against a rival boss, meted out with an ironmonger's tools. No Tarantinoesque slant of comedy: it is just claustrophobic and disgusting. It is at these moments where Paul McGuigan appears persuasively to suggest that the gangster film works not as a type of action movie, or black comedy, but as a species of horror film.

Gangster No 1 is not for everyone; there is something in the world it conjures up - at once banal and excessive - which may not appeal. It consciously (and laudably) refuses the confectionery of comedy and farce, and it can be unsubtle. McDowell sneers at the camera: "What d'you take me for - a CUNT?" (the answer is yes, yes, a thousand times yes, incidentally) but that c-word at least shows a candid grasp of real gangster idiom primly avoided by, say, All Saints and David A Stewart.

Let's give thanks for a film that isn't just a bunch of actors who hang out with their cocaine dealers and think they know what criminals are like. This is a powerful and serious film, with shrewdly discovered London locations and interior sets constructed in Berlin's Babelsberg Studios: a miasma of hysteria and anxiety - a real addition to the British crime canon.