Sister Campion Livesey doesn’t look like a nun. She doesn’t wear a habit for a start. Indeed, apart from a modest silver cross around her neck, her short hair, smart, practical clothes, energetic demeanour and sharp wit suggest a headmistress rather than a member of a religious order. In fact she is both - but not for long.

This year is her last as head of St Mary’s Shaftesbury, a Catholic girls’ boarding school in deepest Dorset that has been run by nuns for generations. She is handing over to a lay head. It is, Sister Campion says, the final stone in the foundations of the school’s future that the nuns of the Institute of the Blessed Virgin Mary (IBVM) have been working so hard to put in place. As she says, bluntly: “I’ve spent the past 13 years doing myself out of a job.”

The fact is, due to a “crisis of vocations” in the Catholic church there are too few nuns to run church schools, and women that do become nuns don’t want to teach in posh girls’ boarding establishments - they’d rather be working with refugees or prisoners. (The nuns did not set out to teach the daughters of the wealthy, says Sister Campion. Following in the footsteps of their 16th-century founder, Mary Ward, they regarded the education of young women as the most important element of their vocation. But they had to charge fees to keep the schools afloat.) St Mary’s Ascot in Berkshire, Shaftesbury’s more cosmopolitan sister school, is also to have a lay head. Mary Breen, a physicist and the first female head of department at Eton, will take over from Sister Frances Orchard next January. St Mary’s Cambridge already has a lay head.

When Sister Campion entered the order at 18, she was the second youngest of 120 IBVM nuns in Britain. Now, at 42, she is still the third youngest in a rapidly ageing group.

Fifteen years ago the nuns decided to act: they could wait until the schools were forced to close, or they could gradually float them off from their community without completely losing the religious character of the schools. Either way, they had to concede that there were insufficient vocations to sustain the schools into the next millennium. It has been a long but painful realignment.

Sister Campion says that for a while her successor, Susan Pennington, a married woman in her late forties, will have to be “more Catholic than the Pope”. Mrs Pennington, a maths teacher with a background in further education and state comprehensives as well as the independent sector, is a committed Catholic who has been deputy head at Shaftesbury for the past two years. She is currently shadowing Sister Campion, learning the ropes of headship, only too aware that her Catholicism will be under intense scrutiny once she takes the helm.

There is no doubting Mrs Pennington’s commitment. She is in the chapel for Eucharist at 7.30am, along with a handful of girls and other staff. Like Sister Campion she lives in, with a flat in the upper-sixth boarding house. Despite the tricky logistics, her husband, a solicitor in Sheffield, and her children - she has a son in his first year at university and an 18-year-old daughter in a northern boarding school - appreciate her sense of vocation and encouraged her to apply for the St Mary’s headship.

Mrs Pennington is part of a lay prayer group and often starts staff meetings with prayers, unlike Sister Campion. As a nun, Sister Campion can afford to be relaxed about her religion. Mrs Pennington says: “The vocation and IBVM cross that Sister Campion wears says, ‘I live my life for God’. Nobody questions it. I don’t have that badge.

“When the nuns are there you tend to let them do the praying for you; now we have to learn to take the lead for ourselves.”

The IBVM nuns settled in Dorset in 1945, ending their search for a permanent home for their evacuee pupils; the school was originally in Hampstead but had moved in and out of various premises during the war.

They bought Coombe House, a 19th-century mock-medieval manor that had been requisitioned as a rest home for United States Air Force personnel. For the next 40 years they literally built up their school: moving earth when the chapel was built, working the kitchen garden, cleaning, cooking, sleeping wherever there was cupboard space - and educating girls.

When Sister Campion entered the order - one year into a law degree course at Bristol University - she had no plans to teach, but at the age of 29 she found herself headmistress at Shaftesbury. She had arrived at the school three years earlier to teach RE and history and kissed goodbye to her personal life. “I had a bedroom up with the children. First thing I would get the fifth and sixth form up, go to Mass, do a bed-making inspection. I would teach a full timetable of 33 periods a week, supervise study four nights out of five, take school supper, have my own supper, patrol the upper fours, and put the fifth and sixth form to bed.

“There was no time of the day and night when you were not available. At that time we were a community of 22, with eight nuns teaching full-time in the school, but things had to change. Once vocations started to decline, we couldn’t carry on like that without breaking people.”

Sister Campion is still “very hands-on’’, but she is realistic: “We began to look into separating the schools out from the community. We began to change structures, getting lay people to do more. Parents saw the nuns withdrawing and that created uproar; they thought we were betraying them. People kept looking back at unavailable options.”

She took over the headship with a remit to make the school fit for a lay headmistress. A year earlier she had set the school up as an independent charitable company with an independent governing body.

As head she has modernised the curriculum, the buildings and the administration, and put lay staff in key positions of responsibility. And in 1985 she hiked the fees - by more than 11 per cent for boarders and 17 per cent for day girls. “We had no debts, but nothing in the bank except that term’s fees. But we didn’t lose a child.” Although fees are now more than pound;10,000 a year for boarders, the school has a full complement of more than 300 pupils.

The pupils have changed with the school. Where once their role after leaving school might have been that of wife and mother who also performed charitable works, today they are expected to go out into the world as professional women imbued with moral values. They don’t think a lay head will make much difference to their education, except that Mrs Pennington has already introduced more social contact with boys - something for which they are particularly grateful.

Miranda Pountney, head girl, says: “Here you get the chance to think about religion and the chance to reject it, but it’s always there. What we do here, I think, makes us stronger to face situations later in life.”

Another pupil, Rose Gretton, agrees. Sister Campion, she says, is an “enabler rather than an inhibitor’’, and when she goes everything will not fall apart. “She develops strengths in others as well as in herself.”

Sister Campion is adamant that her efforts in preserving the school’s religious character has been energy well spent. “The fact that we base our school on spiritual relationships - with God and with other people - is ever more important; it’s as important as academic and extra-curricular excellence.

“The most important things in life are your relationships, and they don’t fall ready-made from heaven. I am sure most girls will lapse 15 minutes after they have walked out of here, but hopefully they put down spiritual roots that will sustain them.

“Life is an adventure; Mary Ward understood that. We nuns have had to understand that: not to be afraid of dynamism.”

Sister Campion is now considering returning to law- with no regrets. “After 13 years, by the law of diminishing returns I must be past my best. In the handing over to a lay head the school has truly come of age.’’