Arkane Lyon is the French video game developer behind Dishonored, Dishonored 2, Dishonored: Death of the Outsider, Deathloop, and the upcoming Marvel's Blade. Founded as Arkane Studios in Lyon on October 1, 1999, by Raphaël Colantonio and a group of partners, the studio built its name on immersive sims, first-person games where levels can be solved through stealth, combat, supernatural powers, or some messy combination of all three. ZeniMax Media acquired Arkane in 2010, which brought the studio under Microsoft when Microsoft bought ZeniMax in 2021. In July 2026, Microsoft told Arkane Lyon staff it planned to close the studio as part of the Xbox restructuring under CEO Asha Sharma. As of October 2026, French consultations over the closure run until November 13, about 217 jobs are at risk, and Microsoft says it is looking for a partner to finish and release Marvel's Blade.
When Was Arkane Studios Founded?
Arkane Studios was established in Lyon, France, on October 1, 1999, by 11 founders led by Raphaël Colantonio, who had previously worked at Electronic Arts in France. The studio's original goal was to make the kind of first-person role-playing game that Looking Glass Studios had pioneered with Ultima Underworld. Arkane pitched a third Ultima Underworld game to EA, which owned the license, and when that went nowhere the team built its own spiritual successor instead. Throughout its history the Lyon office handled most of the studio's development, and when Arkane later opened a second location in Texas, the two became known as Arkane Lyon and Arkane Austin.
Arx Fatalis (2002)
Arx Fatalis released for PC in 2002, published by JoWooD Productions, with an Xbox version following in 2003. Set in an underground world after the sun has died, it followed an amnesiac prisoner through a city of goblins, trolls, and humans fighting over shrinking space below the surface. Spells were cast by drawing runes with the mouse, and the game's crafting, cooking, and open-ended problem solving laid the groundwork for everything Arkane built later. Sales were modest, but Arkane released the Arx Fatalis source code in 2011, and the fan project Arx Libertatis still keeps it running on modern systems.
Dark Messiah of Might and Magic (2006)
Dark Messiah of Might and Magic released in October 2006, published by Ubisoft and built on Valve's Source engine. It was a first-person action game set in the Might and Magic world of Ashan, following Sareth through a story about a demon prophecy. The physics-driven combat let the player kick enemies off ledges, into spike racks, and into fires, and that boot became the game's calling card. Dark Messiah had a rough multiplayer mode and plenty of bugs at launch, but its first-person melee and environmental kills are a straight line to the combat in Dishonored.
Arkane Austin and the Canceled Projects
Arkane opened a second studio in Austin, Texas, in 2006. Much of the next few years went into projects that never shipped, including The Crossing, a Source engine shooter that blended single-player and multiplayer, and LMNO, a project with Electronic Arts and Steven Spielberg. Arkane also did contract work on 2K Marin's BioShock 2. Harvey Smith, a Deus Ex veteran from Ion Storm, formally joined Arkane in 2008, and he and Colantonio became the creative pairing behind the studio's breakout game.
ZeniMax and Bethesda Acquire Arkane in 2010
ZeniMax Media, the parent company of Bethesda Softworks, acquired Arkane Studios in August 2010. The deal gave Arkane a publisher willing to fund a new first-person immersive sim, a genre most big publishers had stopped backing by then. Bethesda would publish every Arkane game from that point forward.
Dishonored (2012)
Dishonored released on October 9, 2012, for PC, Xbox 360, and PlayStation 3. The player controls Corvo Attano, bodyguard to Empress Jessamine Kaldwin, who is framed for her murder and the kidnapping of her daughter Emily. Set in the plague-ridden, whale oil-powered city of Dunwall, Corvo works with the Loyalist Conspiracy to take down Lord Regent Hiram Burrows and the people behind the coup. The Outsider grants Corvo supernatural powers like Blink, Possession, and Bend Time, and every mission can be finished without killing anyone. The chaos system tracks how violent the player is and changes the city, the rat swarms, and the ending to match. Art director Viktor Antonov, who designed City 17 for Half-Life 2, gave Dunwall its look.
Dishonored won Best Game at the 2013 BAFTA Games Awards. Its story DLC, The Knife of Dunwall and The Brigmore Witches, put the player in control of Daud, the assassin who actually killed the Empress, and those two packs are where the series started setting up Billie Lurk for her own game.
Dishonored 2 (2016)
Dishonored 2 released on November 11, 2016, developed by Arkane Lyon with Harvey Smith as creative director. Set 15 years after the first game, Emily Kaldwin is overthrown by Delilah Copperspoon, the witch from The Brigmore Witches, and the player chooses to play as either Emily or a now fully voiced Corvo. The story moves south to Karnaca in the Empire of the Isles, and the game ran on Arkane's Void Engine, built from id Tech. Two missions get brought up any time the game does. The Clockwork Mansion belongs to inventor Kirin Jindosh, whose whole house reshapes itself with levers, and A Crack in the Slab hands the player a device that flips between the present and the past of the same mansion. The PC version launched with serious performance problems, but the level design is the reason Dishonored 2 still gets recommended to people who missed it.
Prey and the Split Between Lyon and Austin (2017)
Prey released on May 5, 2017, developed by Arkane Austin, while Lyon worked on Dishonored. It shared nothing with the 2006 Prey beyond the name. The player is Morgan Yu aboard the Talos I space station, fighting the Typhon, shapeshifting aliens that can disguise themselves as coffee mugs and chairs. The GLOO Cannon and the Neuromod upgrade system turned the station into another Arkane playground. That same year, Raphaël Colantonio stepped away from Arkane after nearly two decades and later founded WolfEye Studios, which made Weird West in 2022.
Dishonored: Death of the Outsider (2017)
Dishonored: Death of the Outsider released on September 15, 2017, as a standalone expansion from Arkane Lyon. Billie Lurk reunites with her old mentor Daud for one last job, killing the Outsider, the god-like figure who handed out powers through all of Dishonored. Billie gets her own powers like Displace and Foresight, plus contracts that add side objectives in each district. No Dishonored game has followed since, and the Death of the Outsider ending works as a closing chapter for the Outsider's storyline.
Wolfenstein: Youngblood (2019)
Wolfenstein: Youngblood released on July 26, 2019, co-developed by MachineGames and Arkane Lyon. Set in an alternate history Paris in 1980, it follows Jessie and Sophia Blazkowicz, the twin daughters of B.J. Blazkowicz, searching for their missing father. The game was built around two-player co-op with interconnected districts, which is where Arkane's level design influence shows up most. It's a side project in the studio's history, but the Paris setting is worth remembering, since Arkane Lyon went back to the city for Blade.
Deathloop (2021)
Deathloop released on September 14, 2021, for PC and PlayStation 5, with Dinga Bakaba as game director. A publishing deal Bethesda signed before the Microsoft acquisition kept it a timed PlayStation console exclusive for a year, and it came to Xbox Series X|S and Game Pass on September 20, 2022. The player controls Colt Vahn, trapped on the island of Blackreef in a single day that resets at midnight, and the only way out is killing eight targets called Visionaries before the loop restarts. Julianna Blake, the Visionary hunting Colt, can be controlled by another human player who invades the game. The 1960s style and the banter between Colt and Julianna gave Deathloop a personality all its own, and it won Best Game Direction and Best Art Direction at The Game Awards 2021.
Microsoft, Redfall, and the Closure of Arkane Austin
Microsoft completed its acquisition of ZeniMax Media in March 2021, making Arkane part of Xbox Game Studios. Arkane Austin's Redfall launched on May 2, 2023, an open-world co-op vampire shooter set in a Massachusetts island town. It launched locked to 30 frames per second on Xbox Series X|S and was widely panned, and then Xbox head Phil Spencer publicly apologized for it. In May 2024, Microsoft closed Arkane Austin along with Tango Gameworks and Alpha Dog Games, ending work on Redfall. Arkane Lyon was kept open in that round, with Microsoft naming it among the Bethesda teams that would carry on.
Marvel's Blade
Arkane Lyon revealed Marvel's Blade at The Game Awards in December 2023. The teaser put Eric Brooks, the half-vampire hunter known as Blade, in a vampire-infested Paris, and the game is a third-person single-player action game, a first for the studio. Marvel's Blade has no release date or confirmed platforms, and Arkane's public line on it for most of development has been a simple "Let us cook." It's the studio's first licensed project and its first game connected to Marvel.
Is Arkane Lyon Closing?
Asha Sharma took over as Xbox CEO in February 2026 after Phil Spencer retired, and Xbox began a major restructuring of its studios that year. According to French newspaper Le Monde, Arkane Lyon employees were told on July 16, 2026, that Microsoft planned to close the studio. French law requires a company to look for a buyer before shutting down a business like Arkane Lyon, so the studio entered a formal consultation process. In a September 22, 2026, memo to Xbox staff, chief content officer Matt Booty said the same process had already failed to find a buyer for Ninja Theory, and that the Arkane consultation was expected to continue through the end of the year.
As of October 23, 2026, consultations are scheduled to end on November 13, 2026, with roughly 217 jobs at risk. Documents cited by Le Monde place the start of the closure at the end of 2026 and running into early 2027. Unions representing Arkane workers have asked for more time to find a buyer. Microsoft told Le Monde it is still exploring options for Arkane and is looking for a partner to support the next phase of development and bring the project to market. Microsoft has not confirmed a final closure date.
What Happens to Marvel's Blade and Dishonored?
A union representative told Le Monde that Marvel's Blade is near the end of production, which makes it one of the stranger situations in the 2026 Xbox cuts. Marvel's Blade has not been canceled, but its release depends on Microsoft finding a buyer for Arkane Lyon or a partner to finish and publish the game. The Dishonored, Prey, and Deathloop names belong to ZeniMax, which means they stay with Microsoft regardless of what happens to the studio that made them. Arkane Lyon has never announced a Dishonored 3, and if the studio closes, any future Dishonored would come from a team that has never built one.