As if Epic's contact book didn't already read like a Who's Who of games development and publishing, Sega joins a long list of licensees that includes EA, Activision, Capcom, Square Enix, SOE, THQ, Atari - and a raft of independent game studios.

Develop reports that the games using the engine will be developed in the US - its US teams are Secret Level and Sega Studio USA. Details of the projects are set to be announced later in the year.

"Sega is pleased to arm our developers with the sophisticated tools contained in Epic Games’ Unreal Engine 3,” said Simon Jeffery, president and COO, SEGA of America. “Its versatility and power will help SEGA create incredible gaming experiences.”

“Epic is extremely excited to be working with Sega,” said Mark Rein, Vice President, Epic Games, Inc. "Sega has a long history of innovation and leadership in our industry and we’re honored that they’ve chosen to use Unreal Engine 3.”