Dimensionally reduced gravity theories are asymptotically safe

4D Einstein gravity coupled to scalars and abelian gauge fields in its 2-Killing vector reduction is shown to be quasi-renormalizable to all loop orders at the expense of introducing infinitely many essential couplings. The latter can be combined into one or two functions of the 'area radius' associated with the two Killing vectors. The renormalization flow of these couplings is governed by beta functionals expressible in closed form in terms of the (one coupling) beta function of a symmetric space sigma-model. Generically the matter coupled systems are asymptotically safe, that is the flow possesses a non-trivial UV stable fixed point at which the trace anomaly vanishes. The main exception is a minimal coupling of 4D Einstein gravity to massless free scalars, in which case the scalars decouple from gravity at the fixed point. (C) 2003 Elsevier B.V. All rights reserved.