His career was revived in the latter half of the decade, with Hoosiers (1986), No Way Out (1987), starring Kevin Costner, and Mississippi Burning (1988), for which he received his third Best Supporting Actor nomination.

In the early 1990s, Hackman underwent surgery for heart problems, but he continued to work steadily. His performance as the sadistic Sheriff Bill Daggett in Clint Eastwood’s acclaimed Western Unforgiven (1992) finally earned him an Oscar for Best Supporting Actor. He returned repeatedly (with less success) to the Western genre over the next several years, with Geronimo: An American Legend (1993), the sprawling Wyatt Earp (1994), also starring Costner, and The Quick and the Dead (1995). He also played a corrupt lawyer in the hit film adaptation of John Grisham’s best-selling thriller The Firm, starring Tom Cruise.

Hackman’s more recent films have showcased the broad range that he has displayed throughout his career. The villainous Hackman of the Superman films and The Unforgiven comes through in action-thrillers such as Crimson Tide (1995), co-starring Denzel Washington, Extreme Measures (1996), the death-row drama The Chamber (1996, also based on a Grisham novel), and Eastwood’s Absolute Power. In sharp comedies such as Get Shorty (1995) and The Birdcage (1996), by contrast, Hackman displays his comic ability with deadpan portrayals of utterly flawed characters: a struggling B-movie producer and a right-wing senator, respectively. In 1998, he played another flawed good guy—this time a renegade surveillance expert—in the hit film Enemy of the State, costarring Will Smith. His 2000 projects included The Replacements and Third Degree.

In 2001, Hackman impressed audiences and critics yet again with his performances in three very different films: David Mamet's Heist, the war film Behind Enemy Lines, and the eccentric comedy The Royal Tenenbaums, costarring Anjelica Huston, Gwyneth Paltrow, and Ben Stiller, for which Hackman earned a Golden Globe nomination. Hackman has three children—Christopher, Elizabeth, and Leslie—with his first wife, Faye Maltese, whom he married in 1956 and divorced in 1982. In 1991, Hackman married Betsy Arakawa, a musician. The couple resides in Santa Fe, New Mexico, where Hackman has lived since the early 1980s.