Nagoshi Studio officially shuts down, leaving Gang of Dragon in limbo

Nagoshi Studio, the developer founded by Yakuza creator Toshihiro Nagoshi, has officially been dissolved less than a year after revealing its debut game, Gang of Dragon.

Shareholders approved the dissolution on October 31, according to a notice published in Kanpo, Japan’s official government gazette. The closure follows months of uncertainty after parent company NetEase Games reportedly decided to stop funding the Tokyo studio earlier in 2026.

The problems surrounding Nagoshi Studio became public in March when Bloomberg reported that NetEase intended to end its financial support in May. According to the report, finishing Gang of Dragon would have required at least another ¥7 billion, approximately $44.4 million at the time.

NetEase reportedly allowed Nagoshi Studio to explore becoming independent, but the developer would have needed to cover costs associated with retaining the project’s assets and branding. Nagoshi was also said to be searching for another backer, with no replacement funding publicly announced before the studio’s dissolution.

Warning signs continued during the following months. Nagoshi Studio’s website disappeared, while its YouTube channel briefly vanished before returning with its videos, including the Gang of Dragon reveal trailer, set to private.

Gang of Dragon made its public debut during The Game Awards in December 2025. The third-person action-adventure game was set in Tokyo’s Kabukicho district and starred South Korean actor Ma Dong-seok, also known as Don Lee, as crime syndicate member Shin Ji-seong.

Its setting and close-quarters combat immediately invited comparisons with Yakuza and Like a Dragon, the series Nagoshi helped create during his decades at Sega. The project was described as being deep into development when it was revealed, making the funding problems only a few months later particularly abrupt.

NetEase has not separately announced that Gang of Dragon itself is permanently cancelled. With Nagoshi Studio now dissolved and no replacement developer or publisher announced, however, development under the original team has effectively ended and the project’s future remains uncertain.

Nagoshi founded the studio with NetEase backing after leaving Sega in 2021, where he had served as chief creative officer and headed Ryu Ga Gotoku Studio. Gang of Dragon was the new company’s first announced project, meaning Nagoshi Studio has closed without shipping a game of its own.

The closure also comes during NetEase’s broader reduction of overseas development investments. Several studios have faced funding cuts or shutdowns, while companies including Grasshopper Manufacture have separated from NetEase and returned to independent operation.

Neither Nagoshi nor NetEase has announced what will happen to the Gang of Dragon assets or whether another developer could revive the project. The game’s Steam page remains online, but Nagoshi Studio’s October 31 dissolution ends the team originally created to bring it to market.