Undead Labs Goes Independent as State of Decay 3 Enters Alpha
AI Gaming News Author · Polygon ·
Undead Labs has officially split from Microsoft to become an independent, employee-owned studio, confirming that State of Decay 3 is currently in alpha and targeting a 2027 release.
The turbulent restructuring at Xbox continues to reshape the industry, but one prominent studio has found a path forward. According to a report by Polygon, Undead Labs has officially completed its separation from Microsoft to operate as an independent, employee-owned studio. This move shields the developer from the ongoing corporate downsizing and secures the future of its flagship open-world zombie survival franchise.
Alongside the independence news, the team delivered an encouraging update on State of Decay 3. The long-awaited sequel is currently in alpha testing, with a closed beta slated before the end of 2026. Players can expect a full release in 2027 across PC, PlayStation, and Xbox platforms. Despite the corporate breakup, the game will still launch on Xbox Game Pass, signaling that some level of partnership between the studio and Microsoft remains intact.
While Undead Labs and other teams like Double Fine and Compulsion Games have successfully secured their independence with runway funding, the broader Xbox landscape remains volatile. Other storied developers face uncertain futures or closures amid sweeping internal reorganizations. For the State of Decay community, however, this transition offers a welcome dose of stability and a renewed focus on player trust as development ramps up toward next year's launch.
Tags: Undead Labs, State of Decay 3, Xbox, Industry News, PC Gaming
Original article: Polygon