Who is Obsidian Entertainment? The studio behind Fallout: New Vegas, Grounded and Avowed

Obsidian Entertainment has spent more than two decades building games around one central idea: players should be allowed to make meaningful choices.

Sometimes that means deciding the fate of a wasteland faction.

Sometimes it means determining how a fantasy kingdom responds to a political crisis.

Sometimes it means choosing what to say during a conversation.

And sometimes it means deciding whether fighting a spider the size of a building is really worth the risk.

The games may look very different, but the underlying philosophy remains surprisingly consistent.

Obsidian built its reputation through role-playing games such as Star Wars: Knights of the Old Republic II, Neverwinter Nights 2 and Fallout: New Vegas. Pillars of Eternity later helped revive a style of computer RPG many publishers had largely abandoned.

Then the studio expanded.

The Outer Worlds took its RPG philosophy into a new science-fiction universe. Grounded turned a suburban backyard into a survival sandbox. Pentiment became a historical narrative adventure, while Avowed returned Obsidian to a first-person fantasy RPG.

Today, Obsidian operates as part of Xbox Game Studios while continuing to support multiple games and franchises. obsidian.net

Obsidian Entertainment official website

Obsidian Entertainment began with Black Isle veterans

Obsidian Entertainment was founded in Irvine, California, in June 2003.

Five developers established the studio after working within the RPG industry, with several coming from Black Isle Studios.

That heritage mattered.

Black Isle had been closely connected to games including Fallout, Fallout 2, Icewind Dale and Planescape: Torment.

Obsidian therefore did not begin as a studio trying to discover what kind of games it wanted to make.

Its founders already had substantial experience with computer role-playing games.

Xbox later described the company as having been founded by industry veterans from Black Isle Studios under the leadership of Feargus Urquhart. XBOX Wire

Knights of the Old Republic II became Obsidian’s first game

The studio’s first released project carried an enormous responsibility.

Obsidian developed Star Wars: Knights of the Old Republic II – The Sith Lords, following BioWare’s acclaimed original.

The project immediately demonstrated characteristics that would become associated with Obsidian.

Choices mattered.

Characters were complicated.

Moral decisions were not always divided cleanly between good and evil.

Dialogue became an important part of character development.

Most importantly, the game was willing to interrogate the assumptions of the universe it inhabited.

That interest in player choice and complicated consequences would continue throughout Obsidian’s work.

Neverwinter Nights 2 continued the RPG foundation

Obsidian subsequently developed Neverwinter Nights 2.

Again, the studio was working with an established RPG property rather than its own new universe.

However, the game allowed Obsidian to continue developing its approach to companions, dialogue, quests and player decisions.

The pattern was becoming clear.

Obsidian could enter someone else’s universe and still produce something recognisably its own.

That ability would eventually lead to one of the most important games in the studio’s history.

Fallout: New Vegas transformed Obsidian’s reputation

In 2010, Obsidian Entertainment released Fallout: New Vegas.

Bethesda Game Studios had already transformed Fallout into a first-person open-world RPG with Fallout 3.

Obsidian inherited that foundation and took the series somewhere different.

New Vegas placed greater emphasis on factions.

Reputation mattered.

Dialogue mattered.

Skills could create different solutions.

Characters responded differently depending on the player’s choices.

The Mojave became a political landscape rather than simply an open world filled with enemies.

The player was repeatedly asked to decide who should control the region and why.

Those choices helped Fallout: New Vegas develop an unusually long life.

For many players, it became the game most closely associated with Obsidian.

New Vegas showed what Obsidian did differently

Obsidian’s strength was not simply giving players several dialogue options.

The studio frequently tried to make those choices interact with the wider world.

Supporting one faction could damage relations with another.

A character could remember what the player had done.

Skills could create alternative approaches.

Dialogue might solve a problem that another character would handle through violence.

Consequently, character building became more than improving combat statistics.

It could determine what options were available.

That philosophy would eventually become central to Obsidian’s own RPGs.

Obsidian’s history was not always comfortable

Despite creating well-regarded games, Obsidian spent years operating in a difficult part of the industry.

Independent developers often relied on publishing contracts.

Projects could be cancelled.

Development schedules could change.

Studios could move from one contract to another without knowing exactly what came next.

Obsidian experienced those pressures.

That uncertainty eventually contributed to one of the most important decisions in its history.

The studio turned directly to players.

Pillars of Eternity changed Obsidian’s future

In 2012, Obsidian launched a crowdfunding campaign for what was initially called Project Eternity.

The idea deliberately returned to the style of computer RPG associated with games such as Baldur’s Gate, Icewind Dale and Planescape: Torment.

Players responded.

Project Eternity became Pillars of Eternity.

Instead of following whatever direction publishers believed RPGs needed to take, Obsidian could build something much closer to the games its developers had helped create years earlier.

The result became one of the projects that helped establish modern interest in classic-style computer RPGs.

Eora gave Obsidian its own fantasy universe

Pillars of Eternity also gave Obsidian something important.

Its own fantasy setting.

The world of Eora became a foundation the studio could revisit.

Pillars of Eternity II: Deadfire expanded it.

Years later, Avowed would return to the same universe from a very different perspective.

That continuity gave Obsidian an intellectual property it could develop without working inside another company’s fictional world.

It would become increasingly important after Microsoft entered the picture.

Microsoft acquired Obsidian Entertainment

In November 2018, Microsoft announced its intention to acquire Obsidian Entertainment.

The announcement came alongside Microsoft’s acquisition of inXile Entertainment.

Xbox said Obsidian would join Microsoft Studios while continuing to operate autonomously. XBOX Wire

The acquisition fundamentally changed Obsidian’s position.

For much of its history, the studio had survived by moving between publisher-funded projects.

Now it belonged to one of the world’s largest technology companies.

The challenge became different.

Obsidian no longer needed to prove it could survive independently.

It needed to demonstrate what it could build with greater stability.

The Outer Worlds arrived during the transition

The Outer Worlds arrived in 2019.

Development had begun before Microsoft’s acquisition, and Private Division published the original game.

Nevertheless, it demonstrated where Obsidian’s RPG design had evolved.

The game offered companions, factions, dialogue, character builds and decisions inside a satirical science-fiction setting.

Players travelled through a corporate-controlled colony where almost every institution had its own interests.

Again, choices mattered.

Again, Obsidian was interested in what happened when different groups wanted incompatible things.

The setting changed.

The studio’s fascination with player agency did not.

Grounded proved Obsidian could do something very different

Then Obsidian made Grounded.

A survival crafting game set in a suburban backyard was not the obvious next project from a studio famous for dialogue-heavy RPGs.

That was precisely why it mattered.

Grounded shrank its characters to insect size and transformed ordinary objects into enormous landmarks.

Grass became a forest.

Water droplets became resources.

Ants became wildlife.

Spiders became terrifying predators.

Yet even outside the RPG genre, Obsidian retained its interest in giving players freedom.

Players could explore, build, craft and survive at their own pace.

Internal link: Link Grounded here to the published TechnologyBlog article Grounded in 2026: Why Obsidian’s backyard survival game still works.

Grounded became much more than an experiment

Grounded entered Early Access in July 2020 before reaching its full release in September 2022.

The concept could easily have remained a smaller experimental project.

Instead, it became one of Obsidian’s major properties.

Its combination of solo survival, cooperative play, exploration, combat and base building gave the studio another audience beyond traditional RPG players.

More importantly, Grounded established a universe Obsidian wanted to revisit.

That eventually led to a sequel.

Grounded 2 is already active in 2026

Grounded 2 entered Early Access and Game Preview on 29 July 2025.

The sequel moves beyond the original backyard into Brookhollow Park and expands the formula with Buggies, different character archetypes and a larger environment. grounded2.obsidian.net

Development has continued throughout 2026.

The Toxic Tangle arrived in January as the first major content update, introducing a new biome, creatures, equipment and building content. grounded2.obsidian.net

Then Obsidian went substantially further.

Into the Abyss became Grounded 2’s biggest update yet

On 11 August 2026, Obsidian released Into the Abyss.

The studio described it as Grounded 2’s biggest update yet.

The update opened a major underwater environment beneath Brookhollow Park’s pond.

It also introduced underwater base building, new creatures, expanded progression and a new amphibious Buggy. grounded2.obsidian.net

That is important context when discussing Obsidian in 2026.

Grounded is no longer simply an unusual side project from an RPG studio.

It has become an actively expanding franchise.

Obsidian is still updating Grounded 2

Development did not stop after Into the Abyss.

Patch 0.5.0.5 arrived on 2 September 2026 and responded directly to player feedback surrounding creature aggression and the Toe Biter Leviathan encounter. grounded2.obsidian.net

That illustrates the purpose of Early Access.

Obsidian can expand the game while responding to how players actually interact with its systems.

Grounded 2 is therefore still evolving rather than being treated as a finished sequel.

Pentiment showed another side of Obsidian

If Grounded demonstrated that Obsidian could build survival games, Pentiment demonstrated something else entirely.

The historical narrative adventure moved away from enormous RPG worlds and combat-heavy systems.

Instead, it focused on characters, investigation, history, religion, social structures and consequences.

Its visual identity drew from illuminated manuscripts and early printed books.

Yet beneath the dramatically different presentation was a familiar Obsidian idea.

The player’s decisions mattered.

Pentiment therefore looked nothing like Fallout: New Vegas.

Philosophically, the connection was much stronger.

Avowed brought Obsidian back to Eora

Obsidian later returned to the Pillars of Eternity universe with Avowed.

Rather than recreating Pillars as another isometric RPG, Avowed approached Eora as a first-person fantasy adventure.

That allowed Obsidian to revisit an established setting through a different type of game.

The result reflects the modern studio particularly well.

Obsidian is no longer defined by one camera perspective or one RPG structure.

Instead, its identity increasingly comes from how it approaches worlds, characters and player decisions.

The Outer Worlds 2 expanded another Obsidian universe

The Outer Worlds also became a franchise.

The Outer Worlds 2 released on 29 October 2025 with Xbox Game Studios as publisher. obsidian.net

The sequel moves to the Arcadia colony and once again places player decisions, factions and companions at the centre of the experience.

Obsidian continued supporting the game during 2026.

Patch 1.2.0.0 arrived in June with fixes and additional features, including customisable gameplay options. obsidian.net

Therefore, Obsidian entered 2026 supporting several substantial games rather than focusing on a single release.

Obsidian Entertainment is unusually busy in 2026

The studio’s current workload demonstrates how much it has changed.

Grounded 2 remains in active Early Access development.

The Outer Worlds 2 continues receiving updates.

Pillars of Eternity also received new patches during 2026.

Obsidian’s official news feed listed Pillars of Eternity Patch 3.9.5.0 in July, more than a decade after the original game launched. obsidian.net

That is a remarkably broad range of active work.

A studio once known primarily for contracted RPG sequels now supports multiple franchises across several genres.

Obsidian’s games look different but share a philosophy

It would be easy to look at Obsidian’s catalogue and see inconsistency.

Fallout: New Vegas is an open-world RPG.

Pillars of Eternity is an isometric computer RPG.

Grounded is survival crafting.

Pentiment is a historical narrative adventure.

Avowed is a first-person fantasy RPG.

Those games do not share one genre.

They share something more important.

Player agency.

Obsidian’s own website summarises its games with a simple idea: “We Give Agency To Our Players.” obsidian.net

That statement fits the catalogue remarkably well.

Player agency means more than dialogue choices

Agency does not necessarily mean selecting dialogue option A, B or C.

In Fallout: New Vegas, it can mean deciding which faction to support.

In Pillars of Eternity, it can mean building a character capable of approaching situations differently.

In Pentiment, it can mean choosing what to investigate and whom to trust.

In Grounded, agency appears through exploration, building and survival.

The implementation changes according to the genre.

The underlying objective remains similar.

Give players meaningful control over how they interact with the game.

Obsidian also gives its worlds room for humour

Another recurring characteristic is humour.

Obsidian’s games can deal with serious subjects without becoming relentlessly serious.

Fallout: New Vegas contains absurd characters alongside political conflict.

The Outer Worlds turns corporate exploitation into satire.

Grounded finds humour in transforming everyday backyard objects into enormous landmarks.

That tonal flexibility gives Obsidian’s worlds personality.

The games can be funny without becoming meaningless.

They can also become serious without losing their identity.

Companions became another Obsidian strength

Many Obsidian RPGs place substantial emphasis on companions.

These characters are not simply additional weapons following the player.

They have opinions.

Histories.

Conflicts.

Personal motivations.

A companion may disagree with what the player does.

They can reveal information about the world through their reactions.

That gives conversations a role beyond delivering quests.

The characters become another way for players to understand the consequences of their decisions.

Obsidian survived because it adapted

The company’s history can be divided into several distinct eras.

First came the independent contract developer.

Then came the studio fighting to build and own projects such as Pillars of Eternity.

After that came Microsoft ownership.

Yet Obsidian remained recognisable throughout those changes.

The technology evolved.

Budgets changed.

Genres expanded.

Publishing relationships changed.

However, player choice remained central.

That consistency helped the studio evolve without becoming trapped by its past.

Joining Xbox did not turn Obsidian into a one-game studio

Microsoft’s acquisition could have pushed Obsidian towards one enormous project at a time.

Instead, the modern studio has produced an unusually varied catalogue.

Grounded and Pentiment existed alongside larger RPG development.

Avowed returned to Eora.

Grounded became a franchise.

The Outer Worlds received a sequel.

That suggests Microsoft’s resources allowed Obsidian to support different types of projects rather than forcing every game into the same commercial template.

Xbox originally said Obsidian would continue operating autonomously after joining Microsoft Studios. XBOX Wire

The diversity of its subsequent catalogue is consistent with that structure.

Grounded may be one of the most important modern Obsidian games

Fallout: New Vegas remains enormously important to Obsidian’s reputation.

Pillars of Eternity helped secure its independence during a difficult period.

However, Grounded demonstrated something different.

Obsidian could create a successful game outside the genre that defined it.

The concept did not depend on an established licensed universe.

It became its own franchise.

Grounded 2 confirms that the original was not simply an experiment.

For TechnologyBlog, that makes the relationship between the Grounded article and this developer profile particularly useful.

Obsidian Entertainment in 2026 is no longer just an RPG developer

Calling Obsidian Entertainment an RPG studio is historically accurate.

It is no longer a complete description.

The company still makes RPGs.

Avowed and The Outer Worlds 2 make that obvious.

However, Grounded expanded the studio into survival crafting.

Pentiment demonstrated its ability to build a smaller historical narrative game.

Grounded 2 turned the survival experiment into an ongoing franchise.

Modern Obsidian is better understood as a studio built around player agency rather than a studio restricted to a particular genre.

What Obsidian Entertainment means for South African gamers

Obsidian’s varied catalogue also creates different considerations for South African players.

Single-player games such as its traditional RPGs do not depend on international multiplayer connectivity.

Grounded and Grounded 2 introduce online co-op, where network conditions depend on the players involved, routing and connection quality.

There is therefore no responsible universal South African latency figure for those games.

However, the ability to play many Obsidian titles primarily as single-player experiences reduces dependence on regional server populations.

That can make the catalogue more accessible than games built entirely around always-online competitive matchmaking.

Why Obsidian Entertainment still matters

Obsidian Entertainment has survived several versions of the games industry.

It survived as an independent developer working on other companies’ properties.

It survived cancelled projects and uncertain publishing relationships.

It turned to crowdfunding when the type of RPG it wanted to build had fallen out of favour with major publishers.

It created its own worlds.

Then it joined Microsoft.

Through all those changes, the studio continued returning to the same question:

What happens when the player is allowed to decide?

Sometimes that decision determines the political future of the Mojave.

Sometimes it changes a relationship with a companion.

Sometimes it determines the fate of a fantasy community.

Sometimes it is simply deciding where to build a base before the spiders arrive.

That is why Obsidian Entertainment remains recognisable even when its games look completely different.

More than 20 years after five developers founded the company, Obsidian is no longer merely the studio that made Fallout: New Vegas.

It is the studio behind Pillars of Eternity, The Outer Worlds, Grounded, Pentiment, Avowed and Grounded 2.

Different worlds.

Different genres.

The same fundamental idea.

Give players choices, and make those choices matter.