Facepunch Studios shocked the game development community on November 24, 2025, by announcing that S&box, their modern game engine built on top of Valve’s Source 2, is now completely open source under the MIT license. This move makes one of the most promising upcoming game platforms freely accessible to developers worldwide, allowing them to view, modify, copy, and even fork the entire codebase for their own projects without paying royalties.
What S&box Actually Is
S&box (pronounced “Sandbox”) is Facepunch’s spiritual successor to Garry’s Mod, the legendary 2004 physics sandbox that spawned countless memes, machinima, and standalone game modes. Unlike a simple remaster, S&box aims to completely eclipse what was possible before by combining modern technology with two decades of lessons learned from Garry’s Mod, Rust, Unity, and Unreal Engine.
The platform functions as both a game engine and a gaming platform similar to Roblox. Developers can create games using C# and the latest .NET framework, publish them on the S&box platform, and potentially earn money through the Play Fund system. Players can browse, download, and play user-created content all within the same ecosystem, with seamless multiplayer capabilities and an integrated asset library.
What makes S&box particularly powerful is its foundation on Valve’s Source 2 engine, the same technology powering Half-Life: Alyx, Counter-Strike 2, and Dota 2. This gives developers access to industry-grade rendering, physics, and animation systems while working in a modern, intuitive development environment. The editor includes features like Hotloading, which shows code changes in real-time without needing to reload projects, dramatically speeding up the development cycle.
What Open Source Actually Means Here
The MIT license is one of the most permissive open source licenses available, essentially allowing developers to do whatever they want with the code. You can view it, learn from it, modify it for your own needs, submit improvements through pull requests, maintain your own fork for standalone games, or even extract portions for use in completely different engines. There are virtually no restrictions beyond basic attribution requirements.
However, there’s an important caveat. The open source release covers all of Facepunch’s high-level systems written in C#, including the entire editor, networking architecture, scene system, UI framework, and much more. What it doesn’t include is the underlying Source 2 engine code, which remains proprietary to Valve. Source 2 provides lower-level systems like rendering, physics, and core engine functionality, while Facepunch’s code sits on top handling game logic and tools.
This arrangement means developers can’t simply compile S&box and run it independently of Source 2. The engine still requires those proprietary Source 2 binaries located in the game/bin directory. But what developers can do is examine exactly how S&box interfaces with Source 2, learn from Facepunch’s implementation decisions, and potentially adapt components for other purposes. Some community members have even speculated about the possibility of creating adapters to run portions of S&box’s high-level systems on other engines like Godot, though this would be extremely complex.
Why Facepunch Made This Decision
In their announcement, Facepunch acknowledged that open sourcing an engine and giving away the code with no royalties might seem odd from a business perspective. Their reasoning comes down to passion and opportunity. “We’re a bunch of nerds that love what we’re creating, we want everyone to use it in whatever way they want, we want to provide opportunities,” they explained.
The decision likely stems from multiple factors. First, Facepunch has the financial cushion to take risks. They’re currently funding S&box’s development using revenue from Garry’s Mod, which continues generating income nearly 21 years after its 2004 release. This long-term thinking allows them to prioritize community building over immediate monetization.
Second, the move positions S&box as a legitimate alternative to Unity and Unreal Engine, especially after Unity’s controversial 2023 decision to retroactively change their pricing model. Garry Newman himself was frustrated by that situation, leading to discussions with Valve about developing S&box into a true game development platform where creators can export standalone games for Steam without paying royalties to Facepunch.
Third, open sourcing creates transparency that benefits everyone. Developers can see exactly how systems work, identify bugs more easily, submit fixes themselves, and learn from production-quality code written by experienced developers. This accelerates improvement and builds trust within the community.
The Play Fund and Monetization Strategy
One aspect that makes S&box unique is its creator monetization system called the Play Fund. Rather than encouraging developers to add microtransactions or ads to their games, Facepunch simply pays creators based on how many people play their content and for how long. The exact algorithm remains secret to prevent gaming the system, but it’s designed to reward games that people genuinely enjoy playing.
At the time of the open source announcement, Facepunch had already paid out over $85,510 to S&box creators through the Play Fund. Payments go out monthly for the previous month’s activity, with a minimum threshold of $100 required before receiving payment. Developers can split payments between team members and receive funds through various payment providers chosen for their ability to serve creators in as many countries as possible, barring those under international sanctions.
This monetization approach serves Facepunch’s interests too. They generate revenue through limited-time cosmetics sold on the Steam Workshop, creating urgency for early access participants to purchase exclusive items before they disappear. These cosmetics can then be traded on the Steam Community Market, with Valve and Facepunch both taking cuts from those secondary sales.
Additionally, Facepunch plans to allow developers to publish and sell games made with S&box as standalone Steam products without any financial or licensing ties back to S&box. This creates a sustainable ecosystem where successful games can grow beyond the platform while still driving attention and users to S&box itself.
Current Status and Release Plans
S&box is currently in developer preview, not yet intended for general public use. The platform has been accessible to developers willing to experiment with unfinished features and potentially breaking changes, but it’s not marketed as a consumer-ready product yet. That’s expected to change in early 2026 when Facepunch targets a full public release.
The timing of the open source announcement suggests the platform is stable enough that Facepunch feels confident letting thousands of developers poke around in the code without causing chaos. Work continues on refining features, fixing bugs, and improving performance. Recent updates have included terrain improvements with anti-tiling and seam fixes, making outdoor environments look significantly better.
Facepunch has also committed to financial transparency, announcing plans to publicly share how much money they make from S&box and how much they pay out to creators. This level of openness is extremely rare in the gaming industry and signals genuine commitment to building a creator-first platform rather than simply extracting maximum profit.
What This Means for Developers
The open source release creates several opportunities for different types of developers. For those learning game development, S&box provides a complete example of how to build a modern game engine on top of existing technology. You can study the networking code, examine the UI implementation, and understand architectural decisions made by experienced professionals.
For indie developers, S&box offers a no-royalty path to creating and publishing games. The integrated platform means built-in multiplayer infrastructure, asset sharing capabilities, and a potential audience already browsing S&box for new experiences. The C# and .NET foundation also makes it accessible to developers coming from Unity who already know those technologies.
For modders and hobbyists, the combination of easy-to-use tools, real-time hot reloading, and the asset library creates an environment where you can quickly prototype ideas and share them with others. The Play Fund means even small projects that attract players can generate some income, encouraging continued development.
The limitation remains that standalone commercial releases still require working out licensing with Valve for Source 2, since that engine code isn’t included in the open source release. But for platform-native content, all barriers have essentially disappeared.
FAQs
Is S&box completely free and open source now?
The S&box engine code written by Facepunch is now open source under the MIT license and available on GitHub. However, the underlying Source 2 engine from Valve remains proprietary. You can view, modify, and use all of Facepunch’s code freely, but you still need the Source 2 binaries to actually run S&box.
Can I make commercial games with S&box?
Yes, with some conditions. You can create and monetize games on the S&box platform through the Play Fund with no royalties to Facepunch. For standalone commercial releases on Steam outside the platform, you’ll need to work out Source 2 licensing with Valve, which Facepunch plans to facilitate but hasn’t fully detailed yet.
What is the MIT license?
The MIT license is one of the most permissive open source licenses available. It allows you to use, copy, modify, merge, publish, distribute, sublicense, and sell copies of the software with minimal restrictions. You just need to include the original copyright notice and license text in any copies or substantial portions.
How does the Play Fund work?
Facepunch creates a daily pool of money distributed among games and maps based on player engagement, roughly calculated using clamped individual player hours. The exact algorithm is kept secret to prevent exploitation. Creators receive monthly payments if they’ve accumulated at least $100, and can split payments among team members.
When will S&box fully release?
Facepunch targets an early 2026 release for S&box’s full public launch. The platform is currently in developer preview, accessible to those willing to work with unfinished features. Early 2026 likely means the first quarter, potentially between January and April.
Is this related to Garry’s Mod?
Yes, S&box is the spiritual successor to Garry’s Mod, also created by Facepunch Studios and Garry Newman. However, it’s not simply Garry’s Mod 2. S&box is built to completely eclipse what was possible in the original by using modern technology like Source 2 and .NET instead of updating the old game.
Can I run S&box on Linux?
While the open source code could theoretically be modified to run natively on Linux, Facepunch isn’t required to accept such contributions even if submitted. However, the transparency of the code could help improve compatibility with Proton, Valve’s compatibility layer for running Windows games on Linux.
What programming language does S&box use?
S&box uses C# with the latest .NET framework for all high-level game logic, editor functionality, networking, UI, and most other systems. This makes it particularly accessible to Unity developers who already know C# and may be looking for alternatives after Unity’s pricing controversies.
How much money have creators made from S&box so far?
As of the open source announcement, Facepunch had paid out over $85,510 to S&box creators through the Play Fund. This amount continues growing as more people create content and the platform gains users during its developer preview period.
The Bigger Picture
Facepunch’s decision to open source S&box represents a fundamentally different approach to game engine business models. While Epic takes a 5% royalty on Unreal Engine games after the first million dollars and Unity attempted to charge per-install, Facepunch is betting on platform effects and creator success driving their revenue instead. By removing barriers and building trust through transparency, they’re positioning S&box as the developer-friendly alternative at a time when many creators feel burned by larger companies changing terms after investment. If the full public release in early 2026 goes smoothly and the platform attracts a critical mass of creators and players, this open source announcement could be remembered as the moment S&box transformed from an interesting experiment into a legitimate force in game development. The fact that it’s all built on Source 2, giving third-party developers their first real access to Valve’s modern engine technology, makes it even more significant for the industry’s future.