Batman can freely move around the Arkham Asylum facility, interacting with characters and undertaking missions, and unlocking new areas by progressing through the main story or obtaining new equipment.

Combat focuses on chaining attacks together against numerous foes while avoiding damage, while stealth allows Batman to conceal himself around an area, using gadgets and the environment to silently eliminate enemies.

Among other sources, the game design was inspired by the Batman comics of Neal Adams and Frank Miller, as well as Grant Morrison's Arkham Asylum: A Serious House on Serious Earth graphic novel.

Built on Unreal Engine 3, Arkham Asylum's production underwent several variations, refining both gameplay such as the combat system, and the central story, resulting in the removal of plot elements and some of Batman's main enemies, who did not fit the tone of the rest of the game.

[3][4][5] The player controls Batman as he traverses Arkham Asylum, a secure facility for the criminally insane located off the coast of Gotham City.

[8] The player can use "Detective Vision"—a visual mode which provides contextual information, tinting the game world blue and highlighting interactive objects like destructible walls and removable grates, the number of enemies in an area and their status—such as their awareness of Batman's presence—and shows civilians and corpses.

Objects can be collected, and some of the Riddler's puzzles require the player to find areas related to the answer to a riddle and scan it with "Detective Vision".

[8] Enemies react to Batman's elimination of their allies, which raises their fear level and alters their behavior; for example, they will adopt new patrol routes, requiring the player to adapt to the changing situation.

[8] The player can use predatory tactics through stealth—including silent takedowns, dropping from overhead perches and snatching enemies away, or using the explosive gel to knock foes off their feet—to tilt the odds in their favor.

[8][9] Arkham Asylum features a series of challenge maps separate from the game's story mode that are unlocked while playing, and others are available as optional downloadable content (DLC).

[5][8] On the PlayStation 3, the Joker is a playable character in the combat and stealth challenge maps via optional DLC; he must confront the asylum guards and police commissioner James Gordon.

[16] On compatible systems, the Microsoft Windows version uses nVidia's PhysX software engine to produce realistic, dynamic interactions with the game world.

[25][26] Batman is aided by his allies Oracle (Kimberly Brooks)—who remotely provides him with intelligence, and police commissioner James Gordon (Tom Kane).

[27] In the asylum, Batman is faced with several supervillains; he must defend himself from an enraged Bane (Fred Tatasciore), subdue indiscriminate serial killer Victor Zsasz (Danny Jacobs), confront the monstrous Killer Croc (Steve Blum), defeat the plant-controlling Poison Ivy (Tasia Valenza),[26] and battle his way through hallucinogen-induced nightmares created by the Scarecrow (Dino Andrade).

There, Batman learns that the Joker returned to the asylum to gain access to Young, who has been developing Titan—a more powerful version of the Venom drug that gives Bane his strength—intending to use it to help patients survive more strenuous therapies.

At Eidos' request, Rocksteady presented their approach to the Batman license, and by May 2007, they had begun developing the game's concept, with full production beginning in September.

[43] By the time Dini joined the project, Rocksteady were investigating the idea of setting the game within Arkham, and had produced preliminary designs depicting it as a huge estate on an island connected to mainland Gotham City by a bridge.

[43] Among various Neal Adams and Frank Miller-penned Batman stories, Grant Morrison's Arkham Asylum: A Serious House on Serious Earth was an inspiration for the game's design.

[46][50][51] Eidos president Ian Livingstone said one developer spent two years working on Batman's cape, using over 700 animations and sound effects to make it move realistically.

[61] Designs for the asylum departed from comic interpretations of a large mansion and instead developed an entire island, with hints of Alcatraz prison, composed of multiple buildings to allow for greater variety and exploration.

The maximum security area was designed to feel claustrophobic and was retrofitted like a bunker, and the Arkham mansion displays a High Gothic style.

[60] To bring these areas to life, the level designers produced game mechanic elements using simple room layouts and shapes, while concept artists worked in tandem to create artwork for each location, following the art direction.

[74] A "Collector's Edition" containing the game, a 14-inch (36 cm) replica of Batman's batarang, a behind-the-scenes DVD, a leather-bound 48-page book about Arkham's inmates, and a code to download the "Crime Alley" challenge map was released.

[78][79] This edition includes the game, support for TriOviz 3D visual effects, two pairs of themed 3D glasses, and the six released DLC challenge maps—two of which were omitted from the North American version.

[24] 1UP.com's Thierry Nguyen gave the game an A−, stating that Rocksteady "manages to combine combat, stealth, storytelling, and cartoon voices into the best digital Batman simulator we've seen to date.

[96] Miller called it the right mix of creepy and cool, and appreciated the gradual damage reflected on Batman's suit as the story progressed, but said that pixelated CGI and lip synching issues diminished the presentation.

He criticized segments in which character logic was sacrificed for video game tropes, citing repeated use of poison gas and electric floors as obstacles.

[8] The combat system was well received for the simplicity of its implementation, allowing players to use it effectively without learning complex combinations of special moves, and the emphasis upon timing and flow to create fluid, graceful, and satisfyingly brutal attacks.

[8][9][14] The final boss fight with the Joker was singled out for vapid gameplay,[9][2] a battle with Killer Croc was labeled boring and overly long, and the reviewers said these should not have been in the game.

[106][107] According to NPD Group, Batman: Arkham Asylum sold approximately 593,000 units in North America during the five tracked days following its release on August 25.