A few months ago, rumors hit the 'net that Sega had axed Obsidian's Aliens RPG, though neither party would either confirm or deny the rumors.  The game was scheduled to be one of three  projects funded by Sega to use the Aliens license, alongside Rebellion's Aliens VS Predator and Gearbox's Aliens: Colonial Marines, both first person shooters.

Earlier today, an administrator of Obsidian's Aliens RPG forum confirmed what was rumored so long ago - the project has unfortunately been canceled.  The Guildmaster writes "Rumors have circled around a bit regarding the fate of the Aliens role playing game that Obsidian and SEGA had been working on. Unfortunately, it is true that we are no longer working on the game, and we wanted to finally announce that officially to everyone who has been following its development."

Aliens RPG was set to release later this year.  Obsidian is currently working on Alpha Protocol, which is set for release this fall for the PS3, 360, and PC.