Japanese developer Level-5 has released an official statement addressing mounting criticism over its extensive reliance on artificial intelligence during game development, a controversy that intensified this month as fans scrutinized trailers for both Yo-Kai Watch 2: Haunted Domain and Professor Layton and the New World of Steam. The studio’s blog post attempts to clarify how it uses AI while outlining plans to correct what players perceive as sloppy visual details in recent promotional materials.
The backlash began after Level-5 openly embraced AI as a tool to boost development efficiency, an admission that alienated longtime supporters drawn to the company by beloved franchises. During this month’s Nintendo Direct, the studio unveiled a trailer for Yo-Kai Watch 2: Haunted Domain, which was then presented again at Level-5 Vision 2026 the following day. Although the footage appeared identical, players noticed subtle differences between the two versions, sparking renewed allegations that AI had been used to alter or generate content.
A Trailer That Changed Between Showings
The discrepancies became a focal point for community suspicion, with fans dissecting frames frame by frame. The situation worsened when Level-5’s own presentation seemed to contain additional anomalies, including an oddly animated depiction of CEO Akihiro Hino that drew widespread attention online.
In response, the company explained in its official blog post that it had used an earlier version of the Yo-Kai Watch 2 trailer because of Nintendo’s strict deadline for the Direct. Level-5 did not confirm or deny whether AI was involved in producing that older cut, but promised to reupload a revised version ahead of Tokyo Game Show. The studio insists the upcoming trailer will contain neither AI-generated elements nor the human errors players had flagged.
We claim that the concerns regarding the strange vending machine, electrical wires, and gutters were actually hand-drawn by an artist. These bizarre drawings and lack of detail were not caused by AI.
Level-5 official blog post
Distinguishing Content From Efficiency Tools
The developer drew a firm line between its game content and the behind-the-scenes processes used to create it. According to Level-5, there is absolutely no direct use of AI in the actual content of Professor Layton and the New World of Steam.
Hino added that AI serves primarily as an efficiency tool within the studio’s workflow, allowing creators to finish products faster while preserving each game’s unique charm. He maintained that individuality remains a human effort throughout development.
AI is mainly used to boost efficiency at Level-5. Each game’s charm and individuality remain untouched and are still created by humans, allowing creators to dedicate themselves to their games.
Akihiro Hino, CEO of Level-5
The controversy has left many fans wary of the studio’s creative direction. While these statements represent a clear attempt at damage control, observers question whether they will repair the relationship between the company and its community, particularly given how openly Level-5 has championed AI usage in recent months.
Looking Ahead
The revised Yo-Kai Watch 2: Haunted Domain trailer is expected to arrive at Tokyo Game Show, offering players a chance to see updated footage free of the flagged anomalies. Until then, Level-5 faces an uphill battle to rebuild trust with a fanbase that has grown increasingly sensitive about transparency in game development.
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