Obsidian Entertainment is reportedly continuing limited development on the cancelled Avowed 2, with a small team remaining on the project while waiting for work to begin on the studio’s reported Fallout game.
According to Bloomberg’s Jason Schreier, the team has continued working on the sequel despite its cancellation in the hope that it could eventually be revived. Schreier said, “Obsidian have a small team that was working on Avowed 2, that’s going to still work on Avowed 2 even though it is canceled. While they wait for other projects like Fallout to be ready for them. Maybe in hopes of getting it uncancelled.”
He added that the project was further along than many people realised. “It was actually further along than most people would guess for a sequel to a game that came out last year. So I think their hope is perhaps they’ll get it so close to finish that Xbox will look at it and say ‘Okay you can finish and release this, it won’t cost that much more to finish it’.”
Bloomberg previously reported that Obsidian had cancelled Avowed 2 as part of a broader restructuring following Microsoft’s Xbox layoffs. The report also claimed the studio had reduced its workforce by around a quarter and shifted its focus towards a new Fallout game reportedly being led by studio design director Josh Sawyer.
The latest report also follows comments from former Obsidian co-founder Chris Avellone, who previously questioned whether the sequel had truly been cancelled because of how far into development it appeared to be.
Neither Obsidian Entertainment nor Microsoft has officially commented on the latest report regarding the continued development of Avowed 2.

