In recent years, critics of neoliberalism have turned to new forms of affective labor as one of the features of late-capitalist shifts in production. What remains less scrutinized, however, is the extent to which these forms of labor, as they are structured by the industries that make use of them, play a role in the development of homosexual identity categories that have also been understood and represented as affective. My study interrogates how the cultural regulation of postwar bodies intersects with an economic program that valorizes market freedom. I view this phase of homosexual modernity as unfolding through the logic of deregulation, linking new homosexual subjects to larger systems of flexible, affective labor integral to the ongoing project of free-market hegemony. Affect theory frames this story as the embodied and emotive capacity for social bonding, an element of labor that must be managed by and extracted from working subjects. My readings of novels featuring gay and lesbian subjects at work disclose writers’ critical engagement with cultural and economic deregulation from its nascent stages in the United States. My analysis traces the narration and re-narration of this modernizing program from the mid-twentieth to early twenty-first-century writers who wrestle with neoliberalism’s ambivalent impact on sexual identity and politics. The project consists of two parts each engaging neoliberal adjustments inaugurated in the early Cold War epoch. My analysis of works by James Baldwin, Patricia Highsmith, Jane Rule, and the lesbian pulp author Paula Christian in the first two chapters explores the recurring centrality of service labor as a significant though under-examined feature of the representation of homosexuality in fiction in the 1950s and early 1960s. These works showcase authors confronting the fraught relationship between homosexuality and deregulation ideology, which diminishes the dominance of particular heteronormative arrangements at the same time as it collaborates with new exploitative regimes under late capitalism. The two chapters of the dissertation’s second part examine the significance of historical fiction that revisits the McCarthy period. I read Audre Lorde’s 1982 biomythography Zami and Barbara Kingsolver’s 2009 novel The Lacuna as pivotal commentaries that re-examine this history through the lens of emotional labor to explore the racial, national, and class-based dimensions of queer identity in the late twentieth and early twenty-first centuries.