The September 2008 ICONS Festival was a memorable event in many ways - not least for the performances by Liam Clancy and Jerry Holland, among the last either would ever give - but particularly so for the Greater Boston-based "alt-trad" band Annalivia.

It was at ICONS 2008 that Annalivia - heretofore a quartet of Flynn Cohen (guitar, vocals), Liz Simmons (vocals), Brendan Carey-Block (fiddle) and Stu Kenney (double bass, five-string banjo) - officially welcomed fiddler-vocalist Emerald Rae into its ranks, and in so doing marked the start of a new direction for the group.

Not that Annalivia hadn't already drawn notice for the unique blend of Irish, Cape Breton, American, and contemporary folk music it showcased on its debut CD, released earlier in 2008. But the two years since Rae's arrival has seen Annalivia begin to realize the full extent of its considerable potential. Their new CD "Barrier Falls" - its formal release takes place at a Sept. 30 concert in Harvard Square's Club Passim - represents a benchmark for this period of growth and development within the quintet, a maturation that has been almost as much interpersonal as musical.

While the addition of Rae's talents as musician, composer and arranger has exceeded expectations, she and other members feel the big difference is that Annalivia has simply become comfortable in its own, fascinatingly diverse skin.

"I think that's what happened is that we've become more settled, more stable, and have been able to really think about how we put our various interests together," says Simmons, who co-founded the band with her husband Cohen in 2007. "Annalivia was born of a love for different kinds of music. We didn't have the privilege of meeting in college, so we had to take more time and effort to get together and find our identity."

That identity is tied to some quite impressive credentials. Cohen, for example, has played with Irish music luminaries such as Cathie Ryan (as did Rae), Aoife Clancy, and John Whelan, but his resume also includes bluegrass and old-timey (Boston City Limits, Adrienne Young) and contra dance (The Sevens). Simmons studied with former Solas vocalist Karan Casey and also has sung with Aoife Clancy. Block, like Rae a former National Scottish Fiddle Champion, was a member of the Glengarry Bhoys. Kenney is a stalwart of the New England contra dance scene with much-revered Wild Asparagus as well as The Sevens.

Still, their individual and collective biographies offer only a hint of Annalivia's range of interests. Both Cohen and Simmons, for example, have a strong affinity for music produced by the 1960s folk revival, and artists like Richard Thompson, Anne Briggs, and Pentangle (Cohen studied under Pentangle guitarist John Renbourn). Block has become increasingly involved in the contra dance scene, playing as part of the trio Matching Orange, and in recent years Rae has explored not only the Irish but the old-timey/Appalachian music traditions. And don't be surprised if you hear Kenney evoke his days as an accompanist to legendary Cajun musician Dewey Balfa.

"There are bands in which the members tend to draw on the same influences," says Cohen. "We have a lot more influences to work with, but yet we see them as different geographical, microcultural expressions of the same music. So we focus on coming up with interesting arrangements that bring these to light."

Annalivia's development has been as much a function of its members' increased familiarity with one another. Rae, in addition to her ties with Cohen and Block, a childhood friend, has found a kindred spirit in Simmons - they lead a weekly session at John Harvard's Brew Pub in Cambridge ("It's a very sisterly relationship," says Rae. "If she drinks too much coffee, I get on her about it."). This summer, Cohen and Simmons moved from to New Hampshire to Gloucester, where Rae lives, and have been able to reaffirm their links to the Boston music scene. Although Block lives in New Hampshire, and Kenney is out in Western Massachusetts, the quintet has developed enough of a rapport to make their get-togethers enjoyable and productive.

The band's progress in the past two years is immediately apparent on "Barrier Falls," which opens with an energetic version of the classic dangerous-lover ballad "Reynardine" - the band calls it "a metaphysical love song" - that is associated with the English folk tradition (although Simmons says the melody was likely Irish). The fiddles periodically enter, stir up the supernatural romance, then hand the proceedings over to Simmons, in as fine a voice as she ever has been, and Cohen.

"When we did the first CD, Brendan had to double-track some of the fiddle parts to get the effect we were looking for," says Cohen. "But we couldn't recreate it on stage. Now with Emerald, we have that fuller more dynamic sound, plus the creative depth from another musician. So we're realizing and building on the vision of that first CD."

It is in the instrumental sets where the Rae-Block combination truly comes to the fore, and never more than on the title track, which comprises jigs composed by Cohen, Rae, and Block, and features an appearance by accordionist John Whelan (the fiddle-accordion harmony on the first tune, with Kenney's folky-funky bass underneath, is a thing of unusual beauty). Rae and Block lead splendidly into Rae's emotional "Wanderlust," Cohen and Kenney masterfully splicing and re-splicing the rhythm, before easing into Block's "Dawning Dark," with its sudden ascensions on the B part.

"We spent a lot of time putting that medley together," says Cohen. "It gives a very good sampling of the composing styles we bring to the band and how we work out our ideas together. Stu's tune ["Freaky Hollow," the 11th track] is a whole other vibe - it has a moodier New England-type feel, especially with the banjo taking the lead."

"Murphy's Shadow," which Cohen says has emerged as "a show-stopper," consists of two reels by Block, the first marked by cleverly aligned accents and syncopation (with a considerable assist from guest percussionist Paddy League) and the second a delightful pell-mell romp in which Rae and Block seem to take turns chasing one another.

"Brendan and Emerald have known each other since they were little kids," says Cohen. "With fiddle players, I think there's always that hint of competitiveness, and you can see the two of them are friends enough that they enjoy giving each other a little nudge here and there."

But Rae and Block also show their trad chops, such as on Tommy Peoples' "Green Fields of Glen Town" and on the sizable march-strathspey-reel set ("Wake Up to Cape Breton").

The band's high regard for traditional material is likewise found among songs like "Lovely Annie," associated with the singing of Northern Ireland's Paddy Tunney: Simmons, later joined by Cohen, brings out the song's unrequited-love theme, with a winsome waltz-like riff by Rae and Block, whose inventiveness similarly undergirds the English-American ballad "John Riley."

"What's nice is we can tailor our sets to certain gigs," notes Rae. "If it's something like ICONS, we can emphasize our Irish repertoire; if it's something like the Champlain Valley Festival, where we played this summer, we pull out our quirky, folky, original material."

Adds Cohen, "We've got a lot of firepower on stage now. Not only do we have the double fiddles, but Liz has become an excellent guitar player, so we can bring some two-guitar dynamics as well."

The band's newest wrinkle is represented through two songs, "The Time Is Up," a Simmons composition, and "Traveling Case," written by Cohen and friend Aram Sinnreich. While Annalivia has featured contemporary songs - including "The Wind Is An Angry Friend" by local singer-songwriter Mark Simos - Simmons agrees that the inclusion of these originals is clearly another significant step.

"It is part of a confidence thing, where you're putting your stuff out there - after all, a song is usually considered an expression of something taken from your life and experience," she says. "The question is do these songs relate to what Annalivia is about? 'The Time Is Up' isn't as up-tempo as most of our other material, but I thought it would lend itself to the more subtle elements in Annalivia: some gentle finger-picked guitar, for example, and a slow, gorgeous fiddle backing."

Even as Annalivia is already contemplating its next CD, its members are looking forward to the Sept. 30 "Barrier Falls" release show at Club Passim [clubpassim.org] and subsequent mini-tour of New England.

"We've gotten a very good response from people who have heard the CD, or have heard us do sets and songs from it in concert," says Rae. "That's really gratifying, because we put a lot of work and care into making our sound gel. Fortunately, we have a great time trotting out our ideas and seeing what we can do with them, so it feels less like a band rehearsal and more like a gathering of friends who have this unique bond with one another."

For more on Annalivia, see annaliviamusic.com