Obsidian Joins Bethesda Umbrella to Co-Develop Next Fallout
With the studio moving under the Bethesda banner, the next Fallout game looks more permanent, more hardcore, and more tightly controlled than you might have thought.
News by Adeela Tas on Sep 23, 2026
Bethesda is bringing Obsidian Entertainment into its family, and if you follow Fallout, that is worth your attention. Obsidian will now sit under the Bethesda Softworks umbrella, and the studio keeps working on its current projects, including Grounded, along with the new Obsidian Fallout game it is building with Bethesda Game Studios.
Put simply, one of the best-known RPG developers just moved closer to the company that owns the franchise. Since the two studios are already working together on that game, you can expect the ties between Obsidian and Bethesda Game Studios to get tighter from here.

They will probably team up more often, especially on Fallout, which is exciting if you like the series.
It also hints at the technology behind the project. The upcoming Obsidian Fallout game very likely runs on Creation Engine. Creation Engine 3 is the updated version being made for The Elder Scrolls VI, and Bethesda recently described it as a platform for Fallout 5 and The Elder Scrolls VI, so it could stretch to this project too.
Nobody has confirmed which engine Obsidian is using, but with Bethesda Game Studios collaborating directly, Creation Engine is the safe bet, whether that turns out to be version 2 or version 3. That would tie the next Fallout game into the same technology as Bethesda's biggest upcoming releases.
There is good reason to think this is a big one. An insider said some time ago that the Obsidian Fallout project is a core Fallout game and not a spin-off in the mold of Fallout: New Vegas. This move makes that look more permanent. Obsidian will likely be working on Fallout for the foreseeable future. Bethesda isn't giving up the IP, but Obsidian could become the dedicated Fallout developer under the Bethesda banner.
The timing lines up with what is happening on screen. The Fallout TV show is not slowing down, with Season 3 currently filming and a release expected next year. A spin-off series based on Fallout Shelter is also on the way, so the brand has plenty of momentum. That gives any new game a bigger audience to reach.
The collaboration could lead to interesting results, mostly because of who is reportedly leading it.
A reporter said Josh Sawyer is leading the Obsidian Fallout game. That detail matters. Josh Sawyer directed Fallout: New Vegas, and he has said before that he would be open to working on Fallout again, depending on the limits he would be working within.
In an interview, he explained that with any project, and especially a familiar IP, the questions are what he is allowed to do and what he wants to do this time that he could not do last time. He added that he loves Fallout and thinks there are still plenty of stories to tell and questions to ask about society.

Based on what has come out so far, the Obsidian Fallout game has a boundary that Fallout: New Vegas never had. It is being made together with Bethesda Game Studios. How involved the studio will be isn't entirely clear. Still, the setup is clearly different from how Fallout: New Vegas came together, when Obsidian led, and Bethesda provided support and oversight. That difference is the main thing to keep in mind as more details arrive.
A reporter asked Todd Howard that exact question, wondering whether Obsidian would lead the way as it did last time or whether this would be more of a joint effort. Howard answered that it is a collaboration and that it is starting now. He added that Bethesda manages the Fallout franchise as a whole through its staff and franchise team.
Read plainly, that suggests Todd Howard and Bethesda will hold creative control over the Obsidian Fallout game.
It probably works a lot like the Fallout TV show. The showrunners handled much of the plot, but Bethesda stayed involved and set limits on what they could touch, and the showrunners have spoken about some of those off-limits areas. Bethesda appeared to have the final say. You should expect Howard to be at least an executive producer on this one, and after this news, you could reasonably expect even more involvement from the studio, not less.
That is not necessarily a bad thing. There may be real excitement inside both studios, because Josh Sawyer and Todd Howard have overlapped in the direction they have taken their games. Sawyer wanted that game to be a more hardcore experience, though parts of that were toned down so it would not push away people who came from Fallout 3.
After release, he put out a mod that made the game harder by cutting experience and resources, so each decision carried more weight and you had to specialize more carefully. His comments about telling more Fallout stories seem to point toward the darker, more desperate side of society, and what happens once it falls apart, possibly explored in new ways in a new game.
Todd Howard and his team have moved in a similar direction. The last time Howard designed a Fallout game, the result was a far more hardcore experience, until they found out the fanbase did not care much for PvP and changed course.

You can see it in the early trailers for Fallout 76, where PvP and fear of every other human was the whole point.
That is why the game launched with no human NPCs, so every human encounter was with a real player and carried built-in suspense. It is hardcore in a different way from what Sawyer did, but it draws on the same fear and scarcity. Leaks suggested internal builds before release were even harsher, almost like a Rust clone. Taken together, both studios have shown they are willing to make Fallout harder and more unforgiving.
Overall, Bethesda has been experimenting with hardcore ideas and seems drawn to darker storytelling. The Obsidian Fallout game will likely involve heavy input from Bethesda's in-house team, which worries some of you, but it also points to a harder, grittier experience.
That is the part of Fallout that works best for a lot of fans: what really happens when a society collapses, and people get desperate. Either way, it will not be a straight sequel to that earlier game, since Sawyer and Howard both want to go somewhere new.
A question hangs over the rest of Obsidian's catalog now that Bethesda owns it. Grounded is confirmed to continue, but Avowed and The Outer Worlds 2 remain unaddressed. Avowed began as something close to a Skyrim-style game, and The Outer Worlds as a Fallout-style one. Calling them clones doesn't do them justice, but the shared vision is obvious, and the team has said as much about Avowed in interviews.
It is fair to wonder how Avowed and The Outer Worlds 2 fit under Bethesda now.
The Outer Worlds 2 was supposed to get two DLCs, and plenty of people already paid for them through the expansion pass. There has been no real news on either one. Some have theorized that refunds could be coming, or that players may get a single DLC along with a partial refund for the second.
Nobody knows what is happening, but the silence does not point to a positive future for those expansions. The situation remains complicated for Obsidian. For many people, this is exciting, since the Obsidian Fallout game puts the studio closer than ever to the series and will likely keep it working there for the foreseeable future.

The trade-off is that, even with Grounded continuing, it probably won't handle as many other things going forward, because a move like this almost certainly comes with at least a partial loss of creative freedom. Either way, the next few years should be interesting for the Fallout franchise.
Whether the Obsidian Fallout game ends up harder, darker, or simply different from what came before, it is a project to keep an eye on, and any new Obsidian Fallout details will say a lot about how much room Obsidian really has under Bethesda.
Editor, NoobFeed
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