What’s New in UE5? Why Unreal’s New Engine Is a Big Deal

Joseph Sibony
Joseph Sibony reading time: 6 minutes
June 22, 2022

Unreal Engine has been one of the top game development tools, ever since it came to market back in 1998. Some of the biggest games in history — the Deus Ex and BioShock franchises, Rocket League, Fortnite, and many, many more — have all been built using various iterations of the engine.

Unreal Engine has even been influential outside of gaming, with the film and television industries increasingly recognizing its usefulness. The Mandalorian, for example, recently used Unreal Studio tech for some of the series’ visual effects, joining the likes of Westworld and several other blockbuster productions.

Despite the significance of the engine, Unreal Engine 4 (UE4) came out way back in 2014, and Epic Games has been promising a major upgrade for some time now. So it’s safe to say that developers have been waiting with bated breath for Unreal Engine 5 (UE5) to drop.

The question is, was the wait worth it?

In short, it’s a resounding yes. But what exactly has changed? And what makes it such a big deal if you’re a game dev?

In this article, we take a look at some of the most important new UE5 features and what they could mean for developers.

What’s new in Unreal Engine 5?

UE4 marked a turning point in game development, making incredibly realistic graphics, open worlds, and more available even to the smallest indie developers. In the past, these kinds of things were only attainable for studios with huge budgets.

But UE5 has raised the bar yet again, with brand-new and enhanced functionality that, frankly, blows UE4 out of the (beautifully rendered) water. Below, we take a look at some of the standout features that are set to change the development landscape for everyone from the largest AAA studios to indie teams, all the way down to amateur at-home developers.


Lighting has always been a huge challenge for developers. It’s a crucial element of realistic, immersive environments, but it’s also extremely complex and difficult to get right. As a result, it’s an expensive part of the process, and developers often have to make a trade-off between lighting and object detail.

UE5 brings Epic’s new flagship lighting engine — Lumen — to the table. Epic describes Lumen as a fully dynamic global illumination solution, and the engine makes it possible to create incredibly realistic dynamic lighting in any environment.

With Lumen, indirect lighting adapts in response to changes in direct lighting or environmental geometry, for example when blowing a hole in a wall, as the sun moves across the sky throughout the day, or when turning on and moving with a flashlight.

Lumen is a truly revolutionary step, cutting down the time (and budget) needed to create realistic lighting. Developers of all scales and budgets will feel the benefit of not having to create lightmap UVs or wait long periods for lightmaps to bake. Simply edit lighting as you go and see the effects in real time.

Nanite — incredibly detailed environments

Nanite is, alongside Lumen, one of the flagship features of UE5. The virtualized micropolygon geometry system is a huge upgrade on previous systems, allowing developers to build high-detail environments much faster.

Until now, developers often relied on manually created assets with different levels of detail to avoid long bake times and frame rate drops. Now, Nanite intelligently processes and displays only the level of detail necessary for the situation and distance, so there’s no need to manually set the levels of detail (LODs). 

Essentially, Nanite makes it possible to quickly create and render movie-quality assets, and environments containing tens of billions of polygons that don’t tank frame rates and loading times. The mind-blowing potential of Nanite, combined with Lumen, can be seen in Epic’s real-time demo, Lumen in the Land of Nanite.

A huge asset library

Anyone who’s dabbled in game development understands the agony of creating or sourcing high-quality and varied game dev assets. It’s a monotonous process, but without the proper attention, you either get repetitive environments that bore gamers, or a world full of objects that look like they were made with Play-Doh by drunk 5-year-olds.

It’s actually one of the most time-consuming parts of development, eating into budgets and creating a big gap in the capabilities of large and small producers.

Now that Epic Games has acquired Quixel, the entire Megascans library is available to users from directly within the interface via Quixel Bridge. This means developers can browse thousands of stunningly detailed assets then simply drag and drop them into environments.

Improved AI

Realistic and reliable AI is a big factor in creating truly immersive environments for gamers. UE5 makes this simpler than ever, with a range of advanced AI upgrades, including:

  • Improved mass avoidance
  • Long-distance navigation paths
  • Smart objects that can be interacted with
  • The ability to have thousands of AI agents in a single scene
  • Support for integrated machine learning training frameworks

Forward compatibility

Another helpful feature is the forward compatibility support for games created in UE4. This wasn’t possible for games created in UE3 when UE4 dropped, so Epic Games has made sure to include it in UE5.

This is sure to delight many game devs that may have already started building next-gen games in UE4. In theory, they’ll be able to easily port gaming projects to UE5 and take advantage of all the new features without wasting any of their previous work.

World Partition — easier for smaller developers to build large open worlds 

Epic has made it clear it’s put a priority on making it easier for development teams of all sizes to create open worlds. Open-world games are among the most popular and profitable of all time, but until now they’ve required an enormous time and money investment to create, cutting out all but the biggest studios. UE5 brings several fresh features to the table to change this, including:

    • A World Partition system that only streams the necessary parts of a world
    • A new One File Per Actor system to facilitate collaboration on the same areas of an open world
  • Data Layers for creating multiple versions of the same world, such as a day and night version or one area in different time periods
  • Large World Coordinates support to make building huge open worlds simpler than ever

UE5 makes it easier to create immersive games

The overriding aim of UE5 is to make games look and feel better, and to help dev teams of all sizes achieve this faster and with less investment than ever before. And it seems to have succeeded.

Everyone from the AAA giants to the individual hobbyist is going to benefit from UE5. The gaming industry is entering a new era, with innovative trends in DevOps, more powerful CPUs and GPUs, and now UE5 all ensuring that there’s never been a more exciting time to be involved.

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Joseph Sibony
Joseph Sibony reading time: 6 minutes minutes June 22, 2022
June 22, 2022

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