It features many tongue-in-cheek references to Sega and the video game industry, particularly Sony Computer Entertainment and its PlayStation 2 console.

Segagaga received a favorable reception from critics, being commended for its humor, gameplay and bizarre nature, alongside its usage of various Sega franchises and for poking fun at the industry itself.

[2] The player must progress through various Sega development studios and fight various employees, who due to the stress and pressure brought on by tight work constraints have turned into mutants.

[1] Should the defeated enemy accept, the player will need to quickly answer questions within a ten-second timer, such as how much the employee will make and what work conditions there are.

Tarō will come across numerous Sega characters throughout the game, including Sonic the Hedgehog, Ristar, Alex Kidd, Sir Pepper III from Clockwork Knight, Nei from Phantasy Star 2, Opa-Opa from Fantasy Zone, the Bad Brothers from Golden Axe, Panda from Baku Baku Animal, Amigo from Samba de Amigo, and the F-14 Tomcat from After Burner.

[1] Towards the end of the game, Tarō pilots a starship known as the "R-720", a nod to the R-360 arcade cabinet, into outer space that features a shoot'em up level reminiscent of Thunder Force.

[1] Segagaga was directed and designed by Tez Okano, who worked on the game in secret for two years before presenting it to the company, fearing that "anything could have happened" if the project was revealed.

[2] Once the finished product was presented, Sega felt that it didn't cast a negative impression on the company and authorized its release.

[15] Official Dreamcast Magazine US applauded the game's sense of humor and bizarre premise, saying that its design and amount of content "will surprise many".

[11] In a more negative light, Dreamcast Magazine Japan commended the game for its "ambitious" premise, but felt that its humor would only really be appreciated by hardcore Sega fans and would fall short to those that weren't.

[14] They unfavorably compared its gameplay to Sakura Wars 3: Is Paris Burning?, recommending that RPG enthusiasts instead buy that game instead of Segagaga.

[1] Kalata concluded his review writing: "Anyone willing to brave the Japanese language will find one of the most original, self-referential titles ever made, a stroke of genius that's a virtual dream come true for Sega fans.

"[18] Writing for GamesRadar+, Chris Antista described it as an "amazingly bizarre swan song" for the Dreamcast, and expressed interest that Sega re-release the game for digital distribution services such as Xbox Live.