"Reports that development for Final Fantasy Versus XIII is on hold are false," the company said in a statement reported by Eurogamer. "The truth of the situation is that when free, some staff from the Versus team have been helping with the XIII team on development of Final Fantasy XIII."

The statement directly contradicts yesterday's report from Japanese gaming magazine Famitsu, in which Final Fantasy XIII (PS3) lead designer Tetsuya Nomura said that the team behind Versus XIII were pulled from the project to help complete FF13.

"Development for both titles is continuing as originally scheduled," added Square Enix.

Set in the same universe as Final Fantasy XIII, Versus XIII is an action-RPG featuring completely different characters and story than its main series counterpart. The games were announced at E3 2006 alongside a third title, Final Fantasy Agito XIII, in development for mobile phones.