Level 5 has addressed criticism surrounding its use of generative AI in promotional material shown during its LEVEL5 VISION 2026 II: Dream presentation. The developer apologized for creating confusion around several images and videos, explaining that some apparent AI mistakes were actually the result of intentional design decisions or human errors.
The company has now promised to restrict future AI use to efficiency-focused applications and avoid directly using the technology in videos presented to users.
Level 5 Apologizes for Generative AI Confusion
The controversy followed Level 5’s September 10 presentation, which showcased upcoming projects including Yo-kai Watch 2: Haunted Domain, Professor Layton and the Curious Village Remake, DecaPolice, Holy Horror Mansion, Snack World: Reloaded, and other titles. The official presentation also featured promotional material that led viewers to question whether generative AI had been used in its production.
In its September 17 statement, Level 5 acknowledged that it had used generative AI in some aspects of its presentation and admitted that its handling of the technology had caused distrust.
“We offer our deepest apologies for causing suspicions in our production process due to our inexperience with generative AI and simple human errors,”
the company said.
Level 5 also clarified an important distinction. According to the company, AI was not directly used in the production of its games themselves. Instead, the controversy primarily involved promotional and presentation materials.
Yo-kai Watch 2 Image Sparked Questions
One of the biggest points of discussion involved concept artwork for Yo-kai Watch 2: Haunted Domain. Viewers noticed unusual details in the background, including electrical poles and wires, vending machines, rain gutters, and a bicycle that appeared to lack brake levers.
Level 5 explained that not all of these details were generated by AI. The company said its designer manually created simplified electrical poles after referencing photographs taken by the designer. The vending machines and rain gutters were also drawn by hand, with their simplified appearance attributed to human errors.
The developer acknowledged that the bicycle’s missing brake levers were not an AI mistake either. It pointed out that the original Yo-kai Watch 2 on Nintendo 3DS also lacked those details, although Level 5 admitted they should have been included given the newer project’s emphasis on improved visual detail.
The studio said revised versions of affected promotional videos would be uploaded around the Tokyo Game Show period.
Level 5 Sets New Limits on AI Use
Level 5’s response also appears to establish a clearer policy for how it intends to use generative AI going forward.
The company said AI use will be limited to “efficiency purposes” and promised to avoid directly incorporating the technology into video content delivered to users. This marks a notable shift in messaging after CEO Akihiro Hino previously acknowledged that AI had been used experimentally during the presentation.
Hino had previously apologized for the controversy, explaining that Level 5 had incorporated cutting-edge AI as an experiment while attempting to create an ambitious presentation.
The company’s latest statement suggests it recognizes that transparency and quality control will be especially important when AI-generated material is used in public-facing content.
Level 5’s recent showcase remains significant for reasons beyond the controversy. The presentation introduced Yo-kai Watch 2: Haunted Domain, which is being developed for Nintendo Switch 2, PlayStation 5, and PC, while also providing updates on several other major projects.
For now, Level 5 says it will take greater care with its production materials and limit AI’s role as it continues development on its upcoming games.
