Development of two big-budget first-party Sony titles, The Getaway and Eight Days - both of which were in production at the firm's London Studio - have been suspended.
The move comes after a budget re-evaluation. The resources dedicated to the two games will now be focused on projects which are closer to completion.
A statement from the studio confirming the news read: "It has been agreed that production of both Eight Days and The Getaway will cease immediately due to the redistribution of resources and budget.
"This decision was made following an internal review of all games and it was deemed that with the incredibly strong list of exclusive first party titles coming up both this year and in the near future, resource should be reallocated to enhance those projects closer to completion.
"Worldwide Studios has a reputation for innovative and entertaining games, with titles such as LittleBigPlanet, SingStar,Buzz, EyeToy and Eye of Judgement, and will continue to push the boundaries on all PlayStation platforms."
Earlier this week, we reported on comments from SCE boss Kaz Hirai that it was the responsibility of internal studios like London to develop the agenda-setting games for the PS3.
Sony also appointed a new head of its worldwide studio operations, Shuhei Yoshida, to replace Phil Harrison recently. At the time of his appointment he was described by Hirai as being responsbile for accelerating "the software development for the PlayStation 3 and PSP platforms and vigorously expand the gaming market".
Statment source: GamesIndustry.biz.