In the late 1990s, the NLA's leaders increasingly struggled to redefine their organization to meet the changing needs of the SM/leather/fetish community. New organizations filled needs previously met by the NLA. The National Coalition for Sexual Freedom (which the NLA was one of the founding coalition partners of) helped members of sexual minorities with legal problems, while the Leather Leadership Conference provided a forum for political discussion and activism. Attendance at both LIL 14 (Fort Lauderdale, 1999) and LIL 15 (Seattle, 2000) proved disappointing, and the latter event left the NLA deeply in debt. Membership fell, and LIL 16 was canceled for lack of registration. Morale plummeted. A ballot initiative to dissolve the NLA failed, but solutions to the NLA's problems proved elusive. However, one notable relevant positive event occurred at this time, when on December 12, 2000, NLA Florida presented a suggested pledge of allegiance to the leather pride flag at its holiday party in Fort Lauderdale, which reads, “I pledge allegiance to the Leather Pride flag, and the union of Leather people for which it stands, with safety, sanity and consent for all.” As well, the Dallas chapter hosted LIL in 2002, but this proved the last LIL. Lacking leadership and direction, the organization neared collapse over the next two years, but its local chapters kept it afloat, particularly those in Columbus, Dallas, New England, and Oklahoma City. A succession of interim presidents stabilized NLA-I and paid off its debt, paving the way for renewed growth in chapters and membership. Since then, the organization has rebounded thanks for new members and chapters. In 2007 NLA-I inaugurated awards for excellence in SM/fetish/leather writing. The categories are: the Geoff Mains award for non-fiction book, the Cynthia Slater award for non-fiction article, the Pauline Reage award for fiction novel, the John Preston award for short fiction and the Samois award for anthology. Past recipients include, among others, Laura Antoniou, Gloria Brame, Rachel Kramer Bussel, Jack Fritscher, Gayle Rubin, David Stein, Cecilia Tan, Tristan Taormino and L M Somerton. In 2019 NLA-I created the Erotic Art Awards. The categories are: Chéri Hérouard - Realism, Clovis Trouille - Surrealism, Gene Bilbrew - Animation, Aubrey Beardsley - Abstract, and Michael Kirwan - Expressionism.
