Psikyo was a Japanese video game developer founded in 1992. Psikyo was an offshoot formed from the Video System team that created the Aero Fighters series. The team mainly developed arcade games, mostly vertically scrolling shoot 'em ups and erotic mahjong games. The popularity of these arcade games led to them being ported to home consoles, and then ultimately led to Psikyo developing games for consoles.
Psikyo was acquired by X-Nauts in mid-2002. In 2003, it was reported that Psikyo was shutting down. Shortly afterwards, X-Nauts stated this news was wrong. Games under the Psikyo label would continue to be released, but would be outsourced to other teams.
Psikyo was known for its difficult "second loops"; after completing the game, you start again, with a high difficulty increase over the first "loop" with enemies firing faster and better. This has been present in every Psikyo shooter, since Samurai Aces, and was present in Aero Fighters. This has even been extended to Aero Fighters 2 and Aero Fighters 3, although these games are not developed by Psikyo.