Prior to the establishment of the studio, Sundberg had worked in video game publishing as well as FIFA Soccer for Electronic Arts.

[4] The company partnered with Conspiracy Entertainment to develop a video game adaptation of Tremors, a movie series from Universal Pictures.

[7][8] Reflecting on the founding in 2015, Sundberg stated that the studio was born in "pure chaos", and attributed their failure with Rock Solid to trusting "the wrong people".

[4] When naming the company, Sundberg, Blomberg and the other employees brought up a list of military code words used during World War II.

In 2008, the studio suffered from layoffs; Avalanche dismissed 77 staff members after the company lost approximately US$35 million due to the loss of two contracted projects.

[20] Despite Avalanche's layoffs, development of Just Cause 2 was completed, and the game was launched in March 2010 for Microsoft Windows, PlayStation 3 and Xbox 360.

[28] Codenamed Project Mamba, the title was a AAA video game set to be released for "next-gen" consoles and PC in 2014.

[29] The new studio is located in SoHo, Manhattan, and is led by David Grijns, who was a former employee of Activision and Atari, SA.

While the original projects never came to fruition, an opportunity was presented to Avalanche Studios by Warner Bros. Interactive Entertainment to develop a video game set within the Mad Max universe.

Film director and creator of the Mad Max franchise, George Miller, was consulted during the game's pre-production period.

Prior to his arrival, he had already been working on a Mad Max game with Miller, leading to a confusing relationship between the two projects.

[9] Avalanche Studios sent a team to visit a jungle in Costa Rica to inspect the local landscapes and environments to help them create the game worlds for both Mad Max and Just Cause 3.

[43] In June 2015, vice president of business development Pim Holfve was promoted to Avalanche Studios's chief executive officer, the first to hold this post.

[45] In June 2016, the Sweden office announced that they had hired Cameron Foote, the lead designer of Just Cause 2's multiplayer mod, to work on both Avalanche's "present and future projects".

[49][1] In June 2018, Avalanche announced a first-person shooter game, titled Generation Zero, scheduled for release on 26 March 2019.

[52] The company announced it was reorganising as Avalanche Studios Group in March 2020, serving as a parent company to three subsidiaries, Avalanche Studios (which will continue to handle AAA titles like Rage and Just Cause), Expansive Worlds (for the outdoor themed titles like theHunter), and Systemic Reaction (for the self-publishing division for games like Generation Zero).

Despite numerous complaints to the company's management and human resources department, no actions were taken; the person voluntarily resigned in mid-2022.

Employees still pressed the leadership on the lack of transparency, and the company posted a public apology to its website in November 2022.

[57] By October, more than 100 staffers had joined Unionen, Sweden's largest labour union, in hopes to negotiate better contracts.

[59] In April 2024 it was announced that the developers had successfully unionized, with Halldórsdóttir open to work along Unionen to implement new frameworks.

[61] Just Cause is a series of open world action-adventure games starring Rico Rodriguez as the protagonist, an operative from "The Agency", a military organization in Just Cause and Just Cause 2.

[78] Generation Zero is an open-world, co-operative, first-person shooter, survival game released on March 26, 2019, and self-published by Avalanche Studios.

The game is set in an alternative 1980s Sweden in which killer robots roam the wilderness and attempt to destroy humans.

It is a top down shooter which had drawn inspirations from 1986's Jackal, 1992's Desert Strike: Return to the Gulf and 1993's Cannon Fodder.

[42] Avalanche Studios was set to be collaborating with Square Enix on the development of the airship segment of Final Fantasy XV.

[84] The studio almost collaborated with LucasArts to develop an open world video game based on the Star Wars universe.

[86] On 14 May 2018, Bethesda announced Avalanche (along with id Software) as developers of Rage 2 for release on Windows PC, Xbox One and PlayStation 4.