Since its advent in the early 1920s, Western Marxism has undergone a torturous process from anti-liberalism to virtually liberalism. The main theoretical deficiency behind this process is the over-estimation of Marx’s cultural critique of capitalism. As his economic research gradually deepened, Marx’s dual critique of capitalism from economic and cultural perspectives matured. When the leading proponents of Soviet Marxism gave prominence to Marx’s economic critique, as circumstances required, they and some key figures in the Second International misread his theory with emphasis on economic determinism. In contrast, Georg Lukács and most Western Marxists proceeded to develop a Marxian cultural critique with the consequence that his economic research being marginalized. Without the counterbalance of a continuous and consistent economic theory to challenge a confident international capitalism, cultural critique is consequently reorganized in confluence with liberalism, which is centered on an individual ontology. Re-excavating Marxian dual critical theory may help Western Marxism escape the dilemma.