Bonnie 'Prince' Billy, Shepherd's Bush Empire, London

The man on stage with the bulging barfly beard and ruffled scraps of remaining hair may not look much like royalty. But Bonnie "Prince" Billy, aka Will Oldham, is certainly among the aristocracy of the burgeoning movement of introspective, traditionally rooted bands that currently form white America's main resistance to the cultural mainstream. Sometimes misleadingly named alt.country, Oldham has been more than its prince, ever since he put child film stardom behind him to form his first band, Palace Brothers, in 1993. With albums such as 1999's I See a Darkness, he has been dubbed the genre's King of Pain. His solo gigs are similarly supposed to be bleak, intense affairs, not for faint hearts. But here, in a theatre rowdily packed to the rafters, ready for a coronation, Oldham put that reputation to the sword. This is American music at its life-affirming best.

Oldham's ad hoc band – including the High Llamas' Sean O'Hagan on guitar and fellow alt.country luminary Jim White on drums – certainly helps. As with the large, intricate ensembles recently brought here by Lambchop and Willard Grant Conspiracy, it suggests a growing, expansive confidence in this previously private form of music, a willingness to evolve and touch audiences. At times, such as in the sly "A King at Night", surreal folk lyrics float over psychedelically adrift, electric sounds.

Oldham himself belies his withdrawn, maudlin image. He certainly cuts a defiantly eccentric figure, his beard alone allying him to the mysterious hillbilly heritage of his home state, Kentucky. His sometimes desperately yowling, sometimes deliberately thin voice and periodically pained, scrunched face add to the backwoods intimations.

But Oldham also jerkily thrusts his hips at us as he sings, even spreads his legs as wide as they will go. And the more you focus on his words, the more you realise that while death and darkness are certainly the subjects, they are used to give depth and value to his true obsessions: love, and sex, of the desperate but satisfying sort of which even music's other Prince would approve.

Sometimes, he's simply saucy, as when "May It Always Be" lets us follow him into the bedroom, right through to the next morning's cup of coffee. But the power of that pleasure comes from his knowledge that one day soon they'll be feeding the worms, an implacable folk insight also behind the declaration that comes in "At One with the Birds": "When we hide our feelings, we may as well fly away."

When he returns for the encore – ordering the removal of something "looking too much like an American flag", indicating his perspective on his country at the moment – he's much more the dark, country preacher of legend. But the roar when he leaves shows he is adored, either way.