Officially announced in 2001, Resident Evil 4 underwent a long development period in which four proposed versions of the game were discarded by the developers before the finished product was released in 2005.
Four formats existed before the final version that became Resident Evil 4. The last three are named the "Castle"; "Hallucination" and "Zombie" versions.
An early attempt at developing Resident Evil 4 was made from 1998 to 2000 for the upcoming PlayStation 2, with Resident Evil 2 director Hideki Kamiya leading the project. The first year was primarily spent on research of what the project would be, and included a trip to Spain for the development staff to study Spanish architecture. The first character designs were made. The direction that the project took was considered too radical a departure from the traditional Resident Evil style and the resulting game was revamped and released as Devil May Cry, which began its own franchise, in 2001.
The development of Resident Evil 4 got its official start in 2001 for the GameCube as part of an exclusivity agreement between Capcom and Nintendo. The first proposed version, dubbed the Castle version, was unveiled in the Tokyo Game Show in 2002 and had Hiroshi Shibata, a background designer for Resident Evil 3: Nemesis, attached to the project as director. This version's premise featured Leon infiltrating the castle of Oswell E. Spencer in Europe and being infected by a new bacteria-sized virus in a quest to eradicate the Progenitor virus. One of the most notable areas shown in this version was a flying airship; however, this version eventually evolved into another as a result of radically new gameplay system ideas.
After the Castle version came the Hallucination version. First shown at E3 in 2003, this version was set in a mansion and featured Leon fighting what appeared to be paranormal enemies, such as medieval suits of armor and living dolls. Still infected with a virus, the screen would adopt a blue filter once the paranormal entities appeared as part of hallucinations. The most notable enemy in this version was the Hook Man, a possessed-looking man carrying a large hook. The game displayed numerous elements that have been carried over to the final release:
- The over-the-shoulder perspective when Leon's weapon is drawn. However, in the video, there are a few times when Leon aims without the over-the-shoulder camera. The game reverts to a third-person view like a traditional Resident Evil game.
- A red laser sight for Leon to use while aiming.
- The flashlight that is added to Leon's character design.
- A suit of armor suddenly attacking Leon when he attempts to pass it, as well as the button combination to dodge the attack.
- The ability to throw a grenade.
- The concept of assigning the L button to draw another type of weapon. In the beta version, the weapon was a grenade; in the final release, the weapon was a knife.
- The 'struggle' feature where player has to break free from an enemy's grasp.
- Leon's health indicator. In the beta, it flashes when Leon is hurt, but in the final release the developers decided to add a HUD to display more information.
This version was reportedly so scary that Shinji Mikami warned the gamers with an infamous quote "Don't pee your pants" prior showing the initial trailer at E3. Gameplay footage of this version was featured in the Biohazard 4 Secret DVD, released in Japan. Ultimately, Castle and Hallucination were scrapped due to technical limitations which would cost too much to resolve.
The final proposal before the finished product reportedly featured zombies as enemies once again. Not much is known about this version as it was never shown publicly. It was considered too formulaic by the developers and was discarded. After this, Shinji Mikami took over directorial duties from Shibata and began working on the version that was released.