NEW UPDATE: It's emerged from last night's Microsoft showcase that Killer Instinct will be a digital release available on day one - and that it will be free-to-play. Jago will be the only character available in the free version, with others unlockable for an as-yet-undisclosed price, as reported by IGN.

UPDATE: The developer of the new Killer Instinct game is Double Helix.

Double Helix is the US developer of Silent Hill: Homecoming, Front Mission Evolved, the Green Lantern and Battleship games.

Studio head Patrick Gilmore said the game's characters feature "some of the most advanced technology ever in a fighting game".

"All the cloth in Jago's costume is simulated, to dynamically animate, wrinkle and respond as the fighter moves. Sabrewulf has an elaborate fur system, and Glacius uses multiple layers of transparency and refraction, along with tens of thousands of physics-colliding shards to depict his ice armor and constructs."

He continued: "It's been a thrilling labor of love for Double Helix. We've always had way more than our share of combat designers and fighting experts at the studio. The opportunity to bring one of gaming's legendary franchises back to fans has been both inspiring and daunting.

ORIGINAL STORY: Rare's classic fighting series Killer Instinct will make a return on Xbox One.

Last spotted in 1996, a brief CGI trailer of the new next-gen version was shown during Microsoft's still-ongoing press event.

The fighter will once again be developed by Rare - a return for the studio to non-Kinect Sports game development (although there's another one of those in the works, too).

Watch the new trailer below:

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Tom Phillips

Tom Phillips

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Tom is Eurogamer's news editor. He writes lots of news, some of the puns and all the stealth Destiny articles.

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