This article places Royall Tyler’s novel, The Algerine Captive, within the socio-political context of the early American Republic which was acutely concerned with the problem of defining its national identity. As a multi-genre text juxtaposing the picaresque format patterned after Henry Fielding’ Joseph Andrews and Tom Jones with the travelogue and the Barbary captivity narrative, The Algerine Captive is a novel which mirrors the incoherent and disjointed character of America in the last two decades of the eighteenth century, in formal as well as generic terms. By the same token, the variegated adventures of the protagonist/narrator Updike Underhill both at home and abroad reveal social, political, legal, religious and racial differences meant to challenge the Federal meaning of nation as an isolated and self-reliant land under the John Adams government. I examine the link between Tyler’s critique of Federalism taken as national insularity and the status of Updike Underhill as a quixotic character. His return to America as a patriotic citizen after escaping from slavery in Algiers is not a traditional quixotic “cure,” i.e. a return to the Federalist status quo. Underhill’s return to his native country enables him to make American society better, not by simply parroting federalist principles, but by upholding and testing cross-cultural differences and global experiences on native soil as a cosmopolitan citizen.