DALLAS — Two things were supposed to happen when the Nasher Sculpture Center opened here in 2003. Famous works like Rodin’s “Age of Bronze” and Matisse’s “Madeleine I” were to be bathed in copious sunlight streaming through a glass roof. And new vigor was to come to the surrounding neighborhood.

The results exceeded expectations. And Dallas has a mess on its hands.

The center, designed by Renzo Piano and Peter Walker, was considered so appealing that a 42-story condominium called Museum Tower sprouted across the street. But the glass skin of the condo tower, still under construction, now reflects so much light that it is threatening artworks in the galleries, burning the plants in the center’s garden and blinding visitors with its glare.

No one quite knows what to do. The condo developer and museum officials are at loggerheads. Fingers are being pointed. Mr. Piano is furious. The developer’s architect is aggrieved. The mayor is involved. A former official in the George W. Bush administration has been asked to mediate.

The situation has been characterized by some here as a David-and-Goliath battle between a beloved nonprofit and commercial interests. But the dispute has also raised the broader question of what can happen when, as is currently the rage, cultural institutions are cast as engines of economic development.