This book investigates how generative AI in the creative sector should be regulated in ways that are both effective and normatively desirable in the current era of datafication and knowledge capitalism. In particular, the book analyses the challenges posed by generative AI at both the input and output phases of the so-called "algorithmic creative process" while, on the one hand, examining how the EU legislator seeks to address these challenges--primarily through the AI Act--and, on the other hand, arguing that the analysis should extend beyond digital law to encompass renewed reflection on intellectual property law itself. In this respect, the book emphasises the need to reaffirm the social function that copyright law is meant to pursue, which is essential both to the effective governance of this phenomenon and to mitigating the risks arising from an uncritical acceptance of the ongoing privatisation of knowledge within the current socio-economic context.