State of Decay 3 Gets Closed Beta Playtests This Year, Weeks After Undead Labs Split From Xbox

Undead Labs will run closed beta playtests for State of Decay 3 before the end of 2026, the studio announced on August 26 via an Xbox Wire blog post. The news lands weeks after Microsoft cut 1,600 jobs and separated from four first-party developers, Undead Labs among them (Eurogamer).

Xbox said it has found a new buyer for Undead Labs, though that buyer has not been named. It is unclear whether State of Decay 3 will still launch into Xbox Game Pass — the subscription service that lets members play titles at no extra charge — on day one.

Despite the ownership change, development is pressing forward. The closed beta builds on a series of closed alpha playtests that began in April 2026, when Undead Labs first opened sign-ups through its official website. Creative director Kevin Patzelt said the studio is expanding both the alpha and the closed beta to more players over time.

The game is Undead Labs' largest map ever and features untethered multiplayer — a mode where players roam the open world freely without being bound to one another's sessions. The studio says it needs to stress-test that scale and fine-tune the experience before launch.

The first wave of alpha testing already gave the team useful data. Players tested how combat balances in co-op sessions and how permadeath — a mechanic where fallen characters are gone for good — affects the player's enclave of survivors. Alpha playtesters also highlighted the game's improved lighting and graphics, deeper clothes and character customisation, and updated "freak" zombies, the special infected enemies that pose unusual threats.

State of Decay 3 was first shown in full gameplay at the Xbox Games Showcase on June 7, 2026. A release-window trailer shown at that event confirmed a 2027 launch across Xbox Series X/S, PC, and PlayStation 5 — a multiplatform release that stands out for a series long associated with Xbox.

For fans, the beta announcement is a concrete signal that the game is still on track despite the turbulence around its studio. Players can register their interest at playtest.stateofdecay.com. A full release is scheduled for sometime in 2027.

The State of Decay series, which tasks players with building and defending communities of survivors in a zombie apocalypse, has been a steady performer for Xbox since the original game launched in 2013. Whether the third entry carries the same Xbox-first identity under new ownership is one of the open questions the beta period will not answer — but the playtests themselves confirm the game is very much alive.