Blake is awakened by his wife, Lynn, who says he was screaming some other woman's name in his sleep. The story begins with a voice calling out to Blake and then screaming. His main goal is to find Lynn and escape alive from the hostile villagers. Later, Blake realizes that he's been stranded in a village with cult members that believe the end of times are upon them. Blake wakes up sometime later, with Lynn nowhere in sight. Due to the desert climate and the region being inaccessible by land vehicles, the two take a chopper to reach their destination, which ends up crashing from unknown complications. The woman was previously found eight months pregnant by the side of the road, before committing suicide in the hospital that she was brought to, according to the facility's records. Blake Langermann, a cameraman, with his wife Lynn, travel to southern Arizona to investigate the murder of a Jane Doe. According to the developers, the main setting takes place in a secluded village, located somewhere in the canyons of Arizona. Murkoff is also scheduled to make their appearance. The game takes place in the same universe as Outlast, after the events of the Mount Massive Asylum Slaughter. Additionally, the camcorder comes with sound detectors for both left and right channels used for locating nearby enemies that are otherwise visually obscured. Its night vision feature can be implemented to help the player navigate through darkness, however batteries are required to keep the camera running and will deplete faster as a result of prolonged night vision usage. All acquired recordings can be played back with the addition of Blake's commentary over them. The Camcorder makes its return with a slightly different HUD and overall appearance and can be used to record unfolding events within Temple Gate. is has been rebuilt from scratch and their patterns differ from the first game. Philippe Morin also noted that enemy A.I. This, however, takes a few seconds and can be disrupted by nearby enemies. Players can restore health by bandaging their wounds. The movement system was also reworked allowing players to slide when running.

There is a limited sprint mechanic, which will decrease player character's stamina over time. Players are able to run and crouch behind objects to avoid their pursuers, prone beneath obstacles, as well as hide within various places, whether it be a barrel, locker, tall grass or a pool of water. Developers commented that in this way, they can repurpose all the assets from previous games, such as animations, scripts, etc. Like the two previous titles, the game is built in Unreal Engine 3, but slightly modified.

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