Obsidian Reportedly Drops Avowed 2 Plans to Start a New Fallout Project

Obsidian Entertainment appears to be shelving Avowed sequel plans in order to pivot toward a new Fallout project, reportedly led by Josh Sawyer, with Bethesda set to collaborate.

Obsidian shifts from Avowed 2 to a new Fallout

Reports indicate Obsidian has dropped work on Avowed 2 and several other unannounced initiatives, redirecting resources to a fresh Fallout game. The project is said to be driven by Josh Sawyer, who was reportedly previously developing a different role-playing game with a structure similar to Fallout.

Sawyer’s background includes serving as lead designer and project director on Fallout: New Vegas, a widely celebrated entry often cited by fans as one of the franchise’s highlights. With Bethesda overseeing the Fallout series for nearly two decades, Bethesda is expected to work alongside Obsidian on the new game.

What happens to Avowed 2, and why this timing?

Even though the sequel’s main development appears to be paused, a smaller team of staff is reportedly staying on Avowed 2 with the goal of potentially restarting the project later. The decision is also tied to a broader shake-up inside Xbox’s organization, which has led to thousands of layoffs.

The same restructuring period has also included Microsoft ending ties with several first-party teams, such as Undead Labs. In Obsidian’s case, reporting claims about a quarter of the studio’s workforce was laid off as part of the changes.

Why players are paying attention—and what comes next

For Fallout fans, the idea of another entry from Obsidian is likely to land as exciting news. Fallout: New Vegas remains a fan-favorite installment, and the IP hasn’t seen a new mainline, single-player release in more than ten years.

Fallout 4 launched in 2015, and a few years afterward, Fallout 76 arrived as an MMO-style experience set in the post-apocalyptic setting. On top of the games, a live-action Fallout television series has also been running on Prime Video, drawing critical praise and high viewership.

That said, the TV show has mostly increased demand for a return to a full single-player Fallout experience. Since Bethesda is currently focused on The Elder Scrolls 6, a new Fallout from Bethesda’s team could still be close to a decade away, making this Obsidian-led pivot a notable sign of shifting priorities.

Earlier this week, it was reported that Bethesda would be concentrating more heavily on its largest franchises, and this move appears to align with that direction.