Peter Molyneux, the creator of Fable, has declared his departure from Microsoft and Lionhead Studios.

“It is with mixed emotions that I made the decision to leave Microsoft and Lionhead Studios, the company that I co-founded in 1997, at the conclusion of development of Fable: The Journey,” reads a statement issued by Microsoft.

“I remain extremely passionate and proud of the people, products and experiences that we created, from Black & White to Fable to our pioneering work with Milo and Kate for the Kinect platform.

“However, I felt the time was right to pursue a new independent venture. I'd like to thank the team at Lionhead, as well as our partners at Microsoft Studios for their support, dedication and incredible work over the years.”

Molyneux will continue to work on Fable: The Journey on a contract basis until it launches later this year.

Molyneux is to join Lionhead’s former chief technical officer Tim Rance at 22 Cans, an independent start-up based in Guildford.

Lionhead has been haemorrhaging talent of late. A number of key staff members recently left the studio to create their own studio, Another Place Productions.

However, Microsoft remains upbeat: “Lionhead co-founder Mark Webley will assume the role of studio manager, while Peter will remain a creative consultant on Fable: The Journey. The development of Fable: The Journey remains on track to be one of the year's most anticipated Kinect for Xbox 360 titles.”