Sunrise Games founder Wayne Smithson worked with Atari producers Alistair Bodin and Darryl Still, focusing on unique gameplay rather than maximizing the console's hardware.

Some reviewers found the game's concept fresh and innovative, but others felt there was a lack of direction due to the changing gameplay elements, while criticism was geared towards its learning curve.

The penguins of Earth were unhappy once they found out about the plan, deciding to fight against the aliens with aid from Bernard and Rodney, two intergalactic freelance heroes sent out to stop the invasion.

[6][7][9] The player can pick up a "Gremlin" creature in the playfield and drop them on a treasure chest to open it, revealing letters that unlock the player-character's weapon once you spell the right word (a bat for Rodney and a pan for Bernard).

[6][14][20] Smithson expanded the Sunrise Games' staff as Mutant Penguins became their main focus, with former Superior Software staffer Mark Robinson joining the company after appliying via a job ad in a computer magazine.

[21] A composer for Mutant Penguins is not credited, though Attention to Detail and Cogent Productions are respectively listed for providing the audio engine, as well as creating its music and sound effects.

[20] Smithson found the Jaguar's hardware similar to the Atari ST but trickier due to its architecture, requiring various tricks to draw sprites and interleaving instructions to achieve an optimal performance.

[23] Producer Daryl Still remembers it as one of his favorite projects, describing the concept as ahead of its time, though speculating that it may have been more popular with newer audiences.

[30][31] The game was first published in Europe on December 1995, and later in North America on March 15, 1996, becoming one of the last releases for the Jaguar before Atari merged with JTS Corporation.

[1] Game Players's Patrick Baggatta felt that the soundtrack was uninspired, but praised the accessible gameplay, stylish visuals, and blend of action and puzzle elements.

[49][50] MAN!AC's Oliver Ehrle praised the game's graphics and animations, but found some of the levels confusing and criticized sections that lacked music or caused stuttering.

"[7] French magazine CD Consoles thought the game's concept was fresh and innovative, but remarked that it graphically looked like a 16-bit title.

While Perry and Morgan praised its humor, storyline, playability, "puzzling" levels, and bonus rounds, both saw the audio as a drawback for not providing a sense of atmosphere.

[13] Power Play's Michael Galuschka thought the visuals were passable and the music was fitting, but noted the "jerky" scrolling in later levels.

[46] PC Player's Monika Stoschek gave positive remarks for the game's audiovisual elements but noted its "occasional instability", opining that the title did not offered innovations in its genre.

[48] PC Zone's Mark Hill found the game confusing, writing "Mutant penguins or not, you wouldn't want your kids' minds warped by this.