GamesRadar's History of Fallout
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The original Fallout had a team of about 100, which mostly dissolved after Fallout's release. However, about a third remained to create Black Isle Studios, with Interplay remaining as the publisher. Fallout 2 was a true sequel to Fallout in the sense that it did everything the original did, but bigger and better.
FO2 accommodated more viable play styles and a larger armory than the original, cementing it as one of the best loved RPGs in the genre. The recruitable NPCs were now more robust, allowing the player to issue more complex orders in battle (i.e. equip armor, go heal, run dammit RUN!). Furthermore, the new (reputation) system complemented the original (Karma) system; making your actions in Town A known to Town B and vice versa. The developers put the reputation system to good use as well. While the original Fallout allowed the player to go Jedi good or Sith evil, FO2 allowed players to engage in more morally grey areas. Players could become a porn star, join the mafia, become a slaver (or side against them), get married (and subsequently divorced), all of which would affect the various NPCs' opinions of you throughout the game.