The Outlast Trials was developed by a team that consisted of around forty people. The developers later clarified that the game will not have any VR features. The initial reveal post also featured an image with characters wearing night vision goggles, leading some readers to speculate that it might be a virtual reality game. On December 4, 2019, Red Barrels officially announced their upcoming title The Outlast Trials, with its story taking place during the Cold War era. On October 31, 2019, Red Barrels posted a teaser image for their upcoming project with a caption that reads 'Where freedom ends'. While not being a direct sequel to Outlast 2, the game's story is set in the same universe. According to Red Barrels, as it was not possible to include downloadable content within Outlast 2, the studio decided instead to work on a separate project that will include much-requested features, likely alluding to Trials' cooperative mode. On December 7, 2017, Red Barrels posted an update on their future plans, which included Outlast 3 and an untitled Outlast-related project that was in the works. Reagents can interact with Murkoff employees to obtain the items that they will need for their next trial. In between the trials, Reagents return to the Sleep Room, where Murkoff takes good care of them. Inside the warehouses, Murkoff has constructed heightened lift-sized models of real-world environments. Imprisoned in a secret Murkoff facility comprising a dozen warehouses and connected by underground tunnels, players will be thrust into a series of physical and mental ordeals, tormented by iconic characters, and challenged alone or in teams to survive with their sanity intact.

The game is set in the same universe as other Outlast-related titles and takes place in the year 1959, during the height of the Cold War era, where players take on the role of test subjects-referred to as Reagents-abducted by the Murkoff Corporation.

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