Riot Games cancels Hytale and shuts down Hypixel Studios after 7 years of development

Summary

• Riot Games has cancelled sandbox RPG Hytale after over seven years in development
  
• Hypixel Studios, the developer behind Hytale, will be closed over the coming months
  
• The studio had been acquired by Riot in 2020, but repeated delays pushed back the game’s release
  
• Development challenges and rising technical ambitions cited as reasons for cancellation
  
• Around 70 employees are affected by the closure
  
• The Hypixel Minecraft server will continue to operate independently
  

Hytale cancelled after years of setbacks

After more than seven years in development, the much-anticipated sandbox RPG Hytale has officially been cancelled. Riot Games, the parent company of developer Hypixel Studios, has also announced it will begin shutting down the studio over the next few months.

The decision was shared by Hypixel co-founder Aaron "Noxy" Donaghey, who described the move as “incredibly tough news” for the team. “This is not the outcome any of us—at Hypixel or at Riot—wanted,” he wrote. “But after years of pushing forward, adapting, and exploring every possible path, it became clear we couldn’t bring Hytale to life in a way that truly delivered on its promise.”

A project that began with high hopes

Hytale was first revealed to the public in 2018, with development already underway for several years prior. In 2020, Hypixel Studios was acquired by Riot Games, the developer behind League of Legends. The game was initially expected to launch in 2021 but was postponed multiple times—first to 2023, and then delayed again without a confirmed release window.

  Riot Games and Hypixel Studios explored options to keep the project aliveYoutube/ Hytale

Inspired by Minecraft, Hytale was intended to offer a similar sandbox experience with RPG elements, modding tools, and a built-in cinematic engine. Its trailer generated significant excitement upon release, but development ultimately became bogged down in complexity and shifting goals.

Technical ambition led to development challenges

In his statement, Noxy acknowledged that the evolution of the game’s vision played a role in its downfall. “Over time, as our vision evolved and the genre matured around us, the bar kept rising,” he explained.

The team attempted to adapt, even going as far as rebooting the game engine. However, despite these efforts, the project remained behind schedule. “It became clear we’d need a lot more time to get it to a place where it could support the ambitious vision for the game,” Noxy added.

  Riot has been praised for providing “generous severance and resources” to affected staffYouTube/ Hytale

Efforts to reduce scope, adjust timelines, or find alternative solutions were considered but ultimately deemed compromises that would have undermined what made Hytale unique. “It wouldn’t have been the game we set out to make. And it wouldn’t have been the game you deserve,” he stated.

No investor or buyer found for Hytale

Riot Games and Hypixel Studios explored options to keep the project alive, including looking for external investors or buyers. However, no viable path forward could be secured. “We still believe in Hytale, but we couldn’t find the right partner to carry it forward,” Noxy said.

Riot has been praised for providing “generous severance and resources” to affected staff, though the exact number of layoffs has not been disclosed. The studio’s LinkedIn page lists its team size as over 70 employees.

Another blow in a difficult year for developers

The closure of Hypixel Studios adds to a growing list of job losses in the games industry, which has seen continued instability in 2025 following waves of layoffs in 2023 and 2024. In June alone, studios such as People Can Fly, Jagex, and Mighty Yell have also announced redundancies.

  - YouTube YouTube/ Hytale 

The ongoing wave of cuts highlights the challenges faced by game developers in a rapidly evolving market. Despite initial hopes that 2025 would mark a recovery, the industry remains unpredictable and, in many cases, unsustainable for mid-sized studios like Hypixel.

Hypixel Minecraft server remains unaffected

Although Hypixel Studios is being closed, Noxy confirmed that the original Hypixel Minecraft server, which operates independently from the studio, will continue to function as usual.

“Even though we’re closing this chapter, the spirit of Hytale and everything we hoped it could be will stay with us,” he wrote. “We’re proud of what we built, and we’ll carry those lessons forward into whatever comes next.”