Riot Games Shuts Down Hytale, Hypixel Studios Begins Wind-Down Following Layoffs

Image: Hytale/Hypixel Studios

Riot Games has officially canceled Hytale, the long-in-development sandbox RPG from Hypixel Studios, leading to significant layoffs and the eventual shutdown of the studio.

Hypixel Studios, best known for the hugely popular Hypixel Minecraft server, was initially backed by Riot Games in 2015 to create a standalone game. That project became Hytale, a fantasy sandbox adventure drawing heavy inspiration from Minecraft, but with added features like RPG-style boss fights, dungeons, minigames, and even a player-accessible coding system to encourage modding and server customization. Riot later acquired the studio in 2020, signaling a strong commitment to the project.

Expectations were high, and Hytale quickly built up a devoted community eager to see what the team could deliver. But after years of development setbacks and shifting ambitions, the project ultimately became too much to handle. As Hypixel CEO Aaron “Noxy” Donaghey explained in an open letter, the game’s technical challenges kept mounting despite a complete reboot of the engine. Even after exploring reduced scopes and altered timelines, the team felt none of the options preserved the original vision of Hytale.

“We’re ending development on Hytale and beginning the process of winding down Hypixel Studios over the next few months,” Noxy stated. "Over time, as our vision evolved and the genre matured around us, the bar kept rising. Our technical ambitions grew more complex, and even after a major reboot of the game engine, the team found that Hytale still wasn’t as far along as it needed to be. 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."

"We looked at reducing scope, adjusting timelines, and finding new angles to keep moving forward. But each of those options would have meant compromising on what made Hytale special in the first place. It wouldn’t have been the game we set out to make. And it wouldn’t have been the game you deserve," Noxy added.

According to a LinkedIn post by Amanda Goodall, around 150 employees were laid off as part of this decision. Riot Games has reportedly provided severance and transitional support to affected team members, with Noxy expressing gratitude for Riot’s efforts to treat the team with care during this difficult moment.

It's worth noting that the original Hypixel Minecraft server is not impacted by these changes. It continues to operate independently and remains active.

As for Hytale, the project may be shelved indefinitely. While Riot Games has not ruled out the possibility of revisiting it someday, no current plans have been announced.

UPDATE June 26: A former Hytale developer, DevSlashNull, clarified that Riot Games was not responsible for halting the development. Following the cancellation, he addressed a question from followers on social media, as one asked, "Did Riot Games ruin Hytale with their corporate greed?" He responded, "Riot was an absolute pleasure to work with, from people to leaders. They understood the power of empowering and giving folks agency. The issues were all internal to Hytales leadership."