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Midway Studios Austin was originally founded in March 2000 by three former employees of Acclaim Entertainment -- Russell Byrd, Cyrus Lum and Craig Galley as the independent studio Inevitable Entertainment. 
The studio first developed Tribes: Aerial Assault, a console adaption of the popular Tribes series which was released in 2002, as well as the Xbox and Gamecube ports of Defender -- a re imagining of the 1980 Midway classic arcade game. The year after, in 2003 they would release The Hobbit, a platform game based on the fantasy novel of the same name. Later, in 2004 while in the process of developing the first person shooter game Area 51 the studio, then known Inevitable Entertainment, was purchased by Midway Games and renamed Midway Studios Austin. Area 51 was released in April 2005, and eventually spawned a sequel which was also developed by Midway Studios Austin dubbed Blacksite: Area 51 which was released in late 2007.

In August 2008 the studio, which had already begun work on a new game suffered layoffs of up to 130 of its employees -- as well as the cancellation of the game "Criminal" that was currently in development. 4 months later, in December of the same year the studio closed down completely, laying off all of the remaining employees. Midway Games released a statement the day of the studio closure, which expressed the decision was made as a result of cost cutting measures.

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