The game continues on the story from Descent: FreeSpace, once again thrusting the player into the role of a pilot fighting against the mysterious aliens, the Shivans. While defending the human race and its alien Vasudan allies, the player also gets involved in putting down a rebellion. The game features large numbers of fighters alongside gigantic capital ships in a battlefield fraught with beams, shells and missiles in detailed star systems and nebulae. Free multiplayer games were available via Parallax Online which also ranked players by their statistics. A persistent galaxy was also available as SquadWar for players to fight with each other over territories.
In 2002, Volition released the source code for the game engine to the public. This code became the core of the FreeSpace 2 Source Code Project, which has produced several mods based on science fiction series such as Babylon 5 and Battlestar Galactica.
The pre-mission briefing stage is where the player gets information on the background and objectives, and selects the ship and weapons. The choices of ships and weapons increase as the player proceeds further along the campaign. Certain missions, however, will dictate certain ships and weapons to be used. Weapons can be classified into primary weapons and secondary weapons. Primary weapons are kinetic and energy weapons, while missiles and torpedoes are classified as secondary weapons. Each weapon has its own specifications such as its rate of fire. They also inflict different damages on hulls (body of the ships) or shields (the protective energy fields surrounding the ships), or possess special effects such as shutting down specific electronic systems or propulsion.
The player flies around in a fighter with a first-person, in-cockpit view with a fully customizable fixed head-up display (HUD) as the visual interface. The HUD displays video communications and relevant data on the ship's status and performance, weapons, objectives, and targets. It can also warn players from which direction missiles are locking onto them from, thus becoming an aide for launching countermeasures or taking evasive maneuvers. Players have to maneuver into position and shoot through both shields and hull to destroy enemy ships. While hull damage is unrecoverable, shields recharge over time. With the game supporting force feedback technology, joystick players will find their controllers vibrating or putting up resistance when they engage the afterburners or collide with objects. Similarly, certain events, such as engaging afterburners and firing powerful weapons, will shake the screen as a form of visual feedback.
FreeSpace 2 has many helpful features available. The player can target enemies attacking a protected objective or match speeds with them. Power can be shunted between shields, engines, and weapons, thereby allowing faster recharge of shields, afterburners, and weapons at the expense of other subsystems. These features can be ignored without any detrimental effects on gameplay. The mission parameters are not rigidly fixed, as there is an allowance for the failures of some primary objectives. When the mission is concluded, a post-mission briefing will be conducted to discuss the mission, and the performance of the player, before the next mission can be taken on.
FreeSpace 2 allows multiplayer player games to be played across a local area network (LAN) or over the Internet via the free services provided by Parallax Online (PXO). The player can communicate with the other network players vocally through FreeSpace 2s own voice chat capability. LAN play allows the players to play the standard player versus player modes such as deathmatch, or cooperate to complete multiplayer missions. They can even join in games which are already underway. The same can be done over PXO but with the added incentive of having the players' statistics of kills and deaths being tracked on a ladder (ranking) system. Players can also form up or join squadrons in SquadWar, an online persistent galaxy hosted by Volition on PXO, where squadrons fight each other for territories.
Journeys between star systems are achieved by "jumping" through jump nodes and traveling through subspace, while shorter intra-system distances are done by "hopping" into subspace at any time. All ships in a mission either "jump" or "hop" to make their entries and exits. The game's starship designs are clearly distinguishable between the three races. Terran starships tend to be plain and practical, the Vasudans' starships are artistic with sleek lines and curves, and the enemies' ships - the Shivans - are sharp and pointy in insidious black and red colors. FreeSpace 2 also features humongous capital ships, thousands of times larger than the fighters, and armed to the teeth with beam weapons and flak guns. These ships are commonly scripted to seek each other out and engage in massive duels.
Just like the player's pilot, most of the other characters are low-key. The non-player character Admiral Aken Bosch, however, plays a crucial part in moving the story. As a prominent antagonist from the start, he sparks off a rebellion which escalates the scale of action, and brings in the other antagonist force, the Shivans, into the story. The storytelling took on a character-driven approach with expositions taking the form of cutscenes in which Bosch gives out monologues, revealing the purpose and driving forces behind his actions. A few established voice actors were brought in to give a polished touch to the voices in the game. Academy Award winner Robert Loggia voiced the player's commanding officer, Admiral Petrarch, and Admiral Bosch was voiced by Ronny Cox. Kurtwood Smith and Stephen Baldwin participated in bit roles as well.
The game begins 32 years after the events in Descent: FreeSpace. The player is a pilot in the Galactic Terran-Vasudan Alliance (GTVA), a single entity formed to cement the alliance between the Terran and Vasudan races. However, opposition still exists to this union, and a faction of Terrans led by Admiral Bosch formed the Neo-Terran Front (NTF) and has rebelled, taking over several star systems. The player's early missions are to quell these rebellions and bring in Admiral Bosch. Eventually the Shivans are encountered in the Gamma Draconis system, where an artificial jump gate had been activated by the NTF, allowing the Shivans access into GTVA space.
A hook is introduced with the introduction of the GTVA's latest ship, the enormous capital ship, the GTVA Colossus. Dwarfing all other capital ships, this juggernaut class ship's power is exhibited to the player as it easily destroys the NTF's fleet. The high tone of the story is maintained as missions keep showing off the Colossus victory after victory, climaxing with its victory over the Shivan juggernaut equivalent, the SJ Sathanas. There is a sudden reversal of fortune as it is revealed there are many more Sathanas juggernauts, and the GTVA is forced to retreat.
The plot device of using a tremendous explosion within a jump node to seal it off in Descent: FreeSpace is re-used here near the end of the campaign. The GTVA has decided to seal off a node to stop the Sathanas horde's advance. Their plan is to send in a bomb-laden ship into the only node in the Shivans' path and remotely detonate it. This becomes a pyrrhic victory, as the GTVA loses the Colossus, their only match for the Sathanas. The finale of the game features the player in a mission to defend the fleeing ships from Shivan attacks. In the midst of the fighting, the system's star is detected to be going supernova, and the player can choose to flee the scene. If the decision is to stay and die defending the remaining ships, a small heroic tribute is paid to the player's character in the ending.
Given a year as the project deadline, the team persevered for long number of hours without sleep (Baranec was said to have gone 700 hours without sleep). Due to the time constraint, a lot of the initial ideas were dropped from the final version of the game, such as atmospheric battles, and new weapons types like a "subspace missile artillery strike". The team made major improvements to the same FreeSpace engine from the first game. By revamping the core of the graphical engine, and adding 32-bit support, they sped up the interface screens and graphic processing. Hardware acceleration for the graphics was also decided to be a requirement to target the high-end machines of 1999. This allowed for a greater number of ships visibly active on the battlefield, satisfying the team's penchant of having great numbers of fighters and capitals ships duking it out in a big battlefield, instead of "multiple small-ass" battles. The shifting of their target focus to higher end machines also fulfilled their top priority of having capital ships many times larger than fighter crafts. The team also followed real world concepts for some of their designs. The Pegasus stealth fighter was modeled on the stealth technology of the 1990s for people to relate to it easily. The game was restrained from becoming too realistic by the team's recognition that most gamers only want believable worlds to have a blast flying around in and blowing things up.
Compared to the graphical changes, the artificial intelligence (AI) of the computer-controlled characters was only slightly changed. The justification given was that the team felt the AI worked very well for the first game. All they had to do was to tweak it a little and fix some bugs. There was, however, a lot of work done in improving the multiplayer portion of the game. For FreeSpace 2, the player's personal computer was assigned a greater role in predicting the possible consequences for other players' actions. This reduced the amount of data needed to be transferred between the computers, which would result in a smoother playing experience. Beta testers were recruited to stress test and troubleshoot the multiplayer mode as well. SquadWar was implemented as an attempt to establish a sense of continuity among the players in the form of a persistent online territorial fight, along with pilot statistics and ladder rankings. Volition hoped this concept would help to establish a strong, online community and build up the game's lifespan. The process of fixing the bugs detected was even publicly published on the game's official website as the "Bug Fix of the Day" feature.
FreeSpace 2 was released on September 30, 1999, one month ahead of schedule. However, the team had to quickly come up with and release a patch (version 1.01) for a software bug which prevented recognition of a CD during the installation process. Three months later, they released the next and final patch (version 1.20) to fix several other bugs. The release of FreeSpace 2 was considerably muted compared to its predecessor Descent: FreeSpace. Its publisher, Interplay, did not organize contests for it, nor did they generate pre-release hype up with the same drive as before. They also posted the incorrect system requirements for the game on their site. FreeSpace 2 was also placed on less-visible shelves than Descent³. However, when GameSpot awarded FreeSpace 2 the "Sci-Fi Simulation of the Year" award, Interplay pushed out the "Sci-Fi Sim of the Year Edition" to capitalize on it.
Despite Volition's interest and desire to develop add-ons and expansions for FreeSpace 2, Interplay told them to stop. Volition was then acquired by THQ in 2000. As Interplay owns the rights to the FreeSpace series (as well as the Descent series) and Volition's owners, THQ, is only interested in pursuing development on what they own, Volition was unable to continue developing the FreeSpace franchise. Faced with source codes which became practically useless to them, Volition released the source code for only the game engines to the public under a noncommercial license on 25 April, 2002. Mike Kulas, the President of Volition, said this was to give those outside the game industry a chance to look at the code of a commercial software, a desire he and Matt Toschlog had when they were not yet in it. In the years since, no sequels to FreeSpace 2 were made and Interplay has only published a limited re-release of it on February 2, 2004 to commemorate the company's 20th anniversary. Interplay went into financial troubles and was forced to close in 2005. It is currently in the process of discharging its debts, partly by selling off its licenses. No one has yet picked up the FreeSpace license. Derek Smart, creator of Battlecruiser 3000AD, had casually mentioned his interest in it, but nothing significant came out of this.
GameSpot felt FreeSpaces story was "both deeper and darker" than either the Wing Commander and X-Wing series, establishing invincible foes who never lost their stature despite the player learning plausible ways of defeating them. Game Revolution felt the story was "first rate" for being able to "build several different conflicts into an unforgettable climax", nicely presented by the emphasis of story telling by means of in-game events. While Eurogamer supported the story as intriguing, it also marked down its rating of the game for the way the story was told. The reviewer felt the "just a cog in the machine" story-telling approach left him apathetic towards the non-player characters and missions in the game. FiringSquad, however, said it created a "very believable military atmosphere," which helped to show how things revolve around big events, instead of just around a single person. Combatsim.com offered another angle; Reynolds said the gameplay elements of FreeSpace 2 are "light years beyond the competition" and more than offsets the loss of being personally immersed in the game's universe.
FreeSpace 2s key attraction is its dogfights. CNN.com said the close-ranged dogfights make for engrossing, and exciting skirmishes. FiringSquad described it as a "total thrill" to be among 20 fighters flying in between opposing capital ships with beams, missiles, and flak all around, while warnings are going off as they try to seek out and destroy their opposite numbers, a view which GameSpot agreed with. The game's AI was judged adequate to provide for such fights, being cunning enough to trick others to crash into the walls of narrow openings, or good enough to detect and warn their wingmen of enemies coming up directly behind them. There are those who expressed minor disappointments with the AI tending to collide too often with other objects. While the dynamic mission objectives were celebrated for coming up with twists and turns to spice up the story, there were a few opinions who found these "in-game red herrings" as being overused instead. Sharky Extreme praised FreeSpace 2 for having the enormous capital ships, as this burst the "trapped in a bubble" trend in Wing Commander- and X-Wing- type games. Instead of the action simply coming to the player, it flows all around, and the player is the one having to go and seek it. The scenes of these giant ships duking it out, with many gnat-like fighters swarming around in their little dances of death, have led to reviewers having a sense of epicness, comparable to reliving battles in science fiction series like Babylon 5 and Star Wars. Few were left unimpressed by the scale of the capital ships; Noel Wade of The Top Shelf was one who felt while the big ships were visually impressive, they had no impact on the player's style of play.
Opinions were generally favorable towards FreeSpace 2s multiplayer implementation. SquadWar received favorable responses from the reviewers who were impressed by its persistent nature and statistics tracking. While the required registration with PXO was considered a troublesome process by a few, the Internet gameplay was a smooth experience with no lag at all. Other reviewers' experiences with lag were different. Reynolds of Combatsim.com said Internet gaming was laggy with ships jumping places, but LAN gaming was smooth sailing. GameSpy's reviewer said lag became more apparent on a dial-up connection during a multiplayer mission with four or more players. FiringSquad's reviewer's experience was similar but he said the lag was not enough to hinder his enjoyment of the multiplayer action.
GameSpot in electing FreeSpace 2 as one of the "Greatest Games of All Time" pointed out that while most of the game's features could be found in its predecessor or peers, its "sheer quality of presentation and gameplay" was the key reason for their choice. Computer and Video Games has acknowledged it as offering the best dogfighting among the space combat classics. Ars Technica also posed FreeSpace 2 as the last significant stage in evolution of the space combat genre as of 2005. Despite all the glowing reviews, FreeSpace 2 sold poorly. The April 2000 issue of PC Gamer stated only 26,983 copies had been sold in the first six months of its release.. These figures were acknowledged as disappointing, and described as awful by Kulas. He, however, stated that as the team had stayed within budget by sticking to schedule, Volition should at least be breaking even with the estimated final sales of the game.
Fans of the FreeSpace series have created modifications (mods) of FreeSpace 2. The first mods were just custom campaigns, with series of missions created through FRED2, the mission editor freely packaged with FreeSpace 2. One such mod which has gained notability is the Inferno mod; a custom campaign, by Steven Woosey, which takes place decades after the conclusion of FreeSpace 2. Released in July 2003, it is now even hosted on established sites, such as GameSpot and CNET, as part of their FreeSpace 2 contents. With the release of the game engine's source code, the possibilities of changing their beloved game greatly opened up, and the fan community rallied to make use of the code to update the game with later technologies. Led by Edward Gardner and Ian Warfield, the FreeSpace 2 Source Code Project was formed to standardize the changes and maintain a core engine for others to take advantage of. Using the new fan updated engine, projects such as Beyond the Red Line, based on the new Battlestar Galactica, and The Babylon Project, based on Babylon 5, have become possible. PXO, the free Internet gaming service handling SquadWar, was initially acquired by THQ in their 2002 acquisition of Outrage Entertainment (renamed as Outrage Games). The service still continued on until July 2003, when Outrage Games was dissolved and PXO terminated. The components of its website were, however, later handed over to the FreeSpace 2 Source Code Project to help them create a similar service in tracking statistics and rankings.