When the defeated Confederate Army declared that “The South Will Rise Again,” they probably weren’t talking about New York Fashion Week. But that’s exactly what happened at last February’s annual trend-setting exhibition. A sold-out crowd showed up at Lincoln Center — the line to get in wrapped around Columbus Avenue — to witness a sneak preview of designer Chris Benz’ fall/winter 2011 collection, which he described as “Spooky Savannah,” inspired from his trips to the gothic Georgia city. With an audience filled with celebrities like Susan Sarandon, Olympic figure skater Johnny Weir and Real Housewives reality TV star Caroline Manzo, models dressed in large floppy hats and tiered ruffles paraded down the runway like characters from Midnight in the Garden of Good and Evil, and on a few occasions even fainted, which just added to the Old Southern aesthetic. A few days later, designer Billy Reid — the 2010 winner of both the GQ Menswear Designer of the Year and the Fashion Fund Prize by the Council of Fashion Designers of America — unveiled his fall ’11 collection, which Forbes magazine described as “the wardrobe of the Southern Gentleman Nouveau — an idealized portrait of early-morning forays out bird hunting and slow evenings spent sipping American Honey.”

Wearing the clothes of a U.S. Southerner when you don’t live anywhere near the South isn’t exactly a new phenomenon. New York hipsters and Hollywood movie stars have been dressing up like good old boys and girls for years, donning Ed Hardy trucker hats and acrylic nails to celebrate their redneck roots. But in recent years, the South has influenced not just fashion but everything from food and booze to art fairs and book clubs; not just in the United States but internationally as well.

The evidence is everywhere, and innumerable. The Kentucky Derby, the annual thoroughbred horse race/ mint julep drinking marathon held in Louisville, Kentucky every May, has seen a spike in attendance in recent years, with 155,804 people showing up for 2010’s race (a 4.8% increase since 2000) and an estimated 16.5 million TV viewers, making it the most watched Derby since 1989. Paula Deen and her two sons, Jamie and Bobby, have built a media empire on fried food and Souther charm, bewitching the nation with a seemingly constant influx of books and TV appearances. Music duo the Bellamy Brothers, famous for their country hit “Let Your Love Flow,” are playing to sold-out crowds in South Africa and Sri Lanka, where according to their booking agent, Judy Seale, they are “treated like Elvis.” In the United Kingdom, sales of Kentucky bourbon, that uniquely American Southern beverage, have risen by 25% since 2005, and the International Wine and Spirits Research predicts that sales will increase by another 22% by 2014. (By contrast, sales of Scotch whisky have declined dramatically.) From Seale, Alabama, where urban hipsters flock to the annual Doo Nanny folk art “micro” festival, a Burning Man with a Southern edge, to Brooklyn, New York, where the young and terminally hip accessorize with church fans and sweat rags at the bi-monthly Grits & Biscuits parties — Southern culture isn’t just for Southerners anymore.

Why is it such a lucrative time for anything exported from below the Mason–Dixon Line? According to Harvey Jackson, a professor of history at Jacksonville State University in Alabama and one of the editors of the popular book series The New Encyclopedia of Southern Culture, believes that much of it has to do with the soothing and laid-back energy of the South. In a world that feels increasingly dangerous and uncivil, he says, “the South is a calmer, quieter place, and a lot of folks are craving that right now.” Kim Holloway, creator of the popular Weblog “Stuff Southern People Like,” suspects that the romanticizing of Southern culture is a way of returning to simpler times and simpler pleasures. “Let’s face it, if you’re out of work, depressed, and stressed out, caviar and sushi aren’t exactly going to stanch the flow of tears,” she says. “But fried chicken might.”

Much of the popularity of Southern culture, Holloway says, has to do with its affordability in tough economic times. “Since the economy tanked, many folks no longer have much disposable income,” she says. “We can’t afford fancy restaurants, spendy evening outings or, hell, even matinee movie tickets.” Instead, Holloway says, they’ve been opting for less pricey entertainment, the types of diversions that Southerners have been drawn to “since the Civil War ended and their money was suddenly as useless as tits on a bull.”

But it’s not just people with limited incomes who have developed an appetite for Southern fare. “You go into the finest restaurants these days and they’re serving shrimp and grits,” says Jamie Deen, the eldest son of celebrity Southern chef Paula Deen. “Down in the South, we call that a poor man’s lunch.” It won’t seem like such a poor man’s lunch if you’re dining in a restaurant like Blue Smoke in New York, where the shrimp and grits costs $26.95. But on most menus — including the Deen family restaurant in Savannah, Georgia, The Lady & Sons — a Southern staple like shrimp and grits rarely costs more than $10. Whether you’re on a tight budget or dine only in five star restaurants, Jamie Deen says, you can still be chic and fashionable.

The Deen Brothers have experienced firsthand the financial windfall of being Southern. In just the last few years, they’ve launched their own magazine, Good Cooking; hosted a Food Network show called Road Tested; and published several best-selling cookbooks, including their latest, Get Fired Up!, which went on sale this Wednesday (April 19th). But even their success doesn’t compare with their mother Paula, they say, who has become an international superstar to rival Martha Stewart or Oprah. Paula Deen has become a household name in countries like South Africa, Alaska and Turkey, where peach cobbler and sweet tea are the furthest things from regional food. “You realize how pervasive the South has become,” says Bobby Deen.

The Deen family hardly have a monopoly when it comes to the global fascination with U.S. Southern cooking. KFC, the quintessential Southern fast food, has opened locations in over 100 countries, most recently in Nigeria and Zambia, and plots are underway to open restaurants in Ghana and East Africa before the end of the year. By 2020, Yum! Brands, Inc. (the Louisville, Kentucky-based company that owns the chain), expects to have 500 KFCs in Russia and Vietnam, respectively, 250 in France and 1,200 in Africa. But none of it compares with the popularity of KFC in China. By the end of 2010, there were a staggering 3,200 KFC restaurants across China, in more than 700 cities. According to Virginia Ferguson, the Public Relations Manager at Yum! Brands, “we expect the Yum! China Division to become our first $1 billion profit business in the near future.”

While the international appeal of Southern-style (and artery clogging) fried chicken may not be surprising, country music is more of a stretch, especially in places like the Middle East. But don’t tell that to Kareem Salaam, a singer-songwriter born in Ponca City, Oklahoma to Egyptian immigrants who plays extra twangy American country music that often features Arabic lyrics. After a successful tour of the Middle East last summer, playing sold-out shows in Morocco, Kuwait, Bahrain, Syria, Jerusalem and Jordan, Salaam can attest that there’s a growing obsession in the region for country music and Southern culture in general. And the fans don’t fit into a tidy demographic. He and his band, he says, are regularly approached by elderly women and young men and, once during a visit to Cairo, an Arabian princess. “The young people thought we were cool,” he says, “the old people thought we were sweet and the rich people thought we were trustworthy.” The multi-generational interest in country music has less to do with the music itself, Salaam suspects, than the uniquely Southern attitude. “We (Southerners) talk slow,” he says. “For young people, talking slow is cool. It says, ‘Hey, I’m too cool to rush.’”

Judy Seale, a booking agent at Nashville–based Refugee International, has devoted her career to bringing Southern performers to foreign countries. And business, she says, has never been better. “(Foreign) audiences don’t want pop or rap music,” she says. “They want peddle steel guitars and fiddles and really traditional-sounding country music.” The biggest markets aren’t in the United Kingdom, she says, but in countries that couldn’t be further, geographically and mentally, from the Grand Ole Opry. In just the last few months, she’s taken several country acts — like Lonestar, Chuck Mead and the Bellamy Brothers — to exotic locations like Oslo, Norway and Untermeitingen, Germany and Zürich, Switzerland. “In Hong Kong and Brazil,” says Seale, “they don’t care who the artist is, just so long as they get off the plane wearing cowboy boots and cowboy hats and looking like they’re from the South.”

The more pervasive Southern culture becomes, the more commercially powerful it becomes. The Pulpwood Queen Book Club in Jefferson, Texas, which began a decade ago as a small gathering at a local hair salon/ bookstore, has grown into a media giant, with 412 chapters across the United States and a membership approaching 3000. According to Variety magazine, the group has an “unusual amount of clout” in the publishing industry — so much that Random House joined forces with them to create a book club talk show, hosted by the Pulpwood’s founder and president, Kathy Patrick, which premiered online in January. “Kathy’s support for our books, though not quantifiable in numbers, is meaningful,” says Avideh Bashirrad, the marketing director for Random House.

Although the Pulpwood Queens have gone global — they currently have chapters in ten foreign countries, including a women’s prison in Anchorage, Alaska — Patrick insists that the group is as proudly Southern as ever. Members are encouraged to keep their hair pouffy (Patrick’s favorite saying is “The higher the hair, the closer to God, so let’s jack it up for Jesus!”), their outfits eccentric and distinctly Southern (she admits a weakness for hot pink and leopard prints), and to always be shouting the official Pulpwood Queen yell: “Woo-hoo!” Every year, they host a “Great Big Ball of Hair” Ball at one of their three book festivals in Jefferson, where members and visiting authors dress up in costumes and let their Southern freak flag fly. “I think everyone has a secret fantasy of playing the Southern belle like Scarlett O’Hara or the Southern gentlemen like Rhett Butler from Gone with the Wind,” says Patrick. “When I grow up, I want to be just like Dolly Parton.”

And it’s not just Southern food and book clubs that have attracted a worldwide following. Clothing designer Billy Reid says that his Southern-flavored clothing sells particularly well in Asia, and while he doesn’t think “the global consumer is trying to be Rhett Butler, I do see them attracted to some of the products that have Southern roots.” Fellow designer Chris Benz, whose clothing sells particularly well in Europe and the Middle and Far Wast, says that the South “can really cross geographic lines and be merchandized into so many wardrobes.” Kelly Stinnett, Benz’s Executive Vice President of Sales, claims that his Southern-flavored clothing has fans in places like Dubai and Tokyo. “They are desperate to get Chris out there,” she says. One may wonder why a city like Tokyo, rattled by an earthquake disaster and an ongoing nuclear reactor meltdown crisis, would care if their clothing looked like something that wouldn’t look out of place in a New Orleans barroom or a Savannah cemetery. But according to Stinnett, the calming, laid-back Southern sensibility may be exactly what the East Asian island nation needs at the moment. “In a sea of a lot of darkness out there,” she says, “this is such a breath of fresh air.”

(This story originally appeared, in a slightly different form, in the April 25, 2011 issue of Bloomberg Businessweek.)