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Elon Musk's xAI to release first AI-generated video game next year

10 Oct 2025 | Rasmus Larsen |

Frustrated with some media giants' "woke agenda", Elon Musk plans to use his massive data centers and AI assistant, Grok, to develop video games though his company xAI.

While Hollywood continues to discuss the pros and cons of using AI to make movies and TV shows, new players are eager to put the technology to work to create new forms of entertainment.

Consumer electronics maker TCL, for example, has started producing its own movies only using AI tools.

Musk's xAI, which also owns social media platform X (formerly Twitter), is stepping into the arena too.

- "The XAI game studio will release a great AI-generated game before the end of next year" Musk wrote this week on X.


Elon Musk's gaming ambitions

The controversial South African entrepreneur has long expressed a passion for gaming and often live-streams himself playing titles such as Diablo IV. His push to develop games is also fueled by frustration with what he sees as a growing "woke agenda" in mainstream entertainment, which also recently led him to call for a Netflix boycott. The project began in November 2024 when Musk started to assemble a game development team.
xAI Gaming
The team behind xAI's gaming efforts. Musk is directly involved. Photo: Dima Zeniuk on X

Massive data centers and Grok

xAI is also behind Grok, the AI assistant competing with ChatGPT, and is building enormous data centers to train and run its AI models. The first facility, named Colossus, is already operational, while Colossus 2 is under construction. Musk's goal is for Colossus 2 to become the world's first gigawatt-scale data center by 2026. He wants to make it powerful enough to help solve the mysteries of the universe – and, apparently, to create video games. At gigawatt scale, it would deliver performance of at least 5–10 exaflops.

What to expect

Even without professional experience, users have already used AI assistants like Grok and ChatGPT to develop simple games such as a basic flight simulator. With just a few prompts, FlatpanelsHD managed to create a functional clone of Pong. But there is still a long way from these simple games to modern complex console games. Musk says that his developers are experimenting with techniques to generate and integrate photorealistic visuals into gameplay. The long-term goal is to make Grok capable of dynamically generating entire game worlds and new levels in real time. To do so, Grok would also need to "play" the game itself to learn and adapt its code on-the-fly. Musk noted that Tesla already uses an early version of this concept to train its self-driving cars. Established game studios like Capcom are also exploring how AI can streamline game development.
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