A survey of the Australian games industry has noted a greater than 50 percent diminishment since 2008.
Across the nation, 126 studios employ only 931 full-time development staff, according to a survey reported by Gamespot.
In 2008, there were only 50 studios Australia-wide, but more than two thousand full time staff.
The data suggests a shift in emphasis from major platform development to independent studios.
Victoria was found to host the greatest number of studios at 44, including Blue Tongue, IronMonkey and Firemint, with Brisbane in second place with half that number.
The survey was conducted as part of the Interactive Skills Integration Scheme, a two year program designed to foster the local development scene.