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Atari's Jaguar was released to combat the dominance that Nintendo and Sega were fighting for. Atari's hope was that by designing a more powerful console, they would be able to leapfrog all of the released systems of the day and give gamers a technologically superior system. The Jaguar eventually faded away due to a number of reasons. For example, it was difficult to program for the Jaguar, thus making it too problematic to have good third party support. Another of the Jaguar's pitfalls was the dominance of the previously popular systems. In 1995, the releases of the Sony PlayStation and the Sega Saturn brought the end for the Jaguar. The failure of the Jaguar put Atari into a poor financial situation and forced it to reverse merge with JTS Inc., a short-lived maker of hard disk drives, to form JTS Corporation. The merger effectively ended the company, which existed as a small department for minor support of the Jaguar and the selling off of Atari's intellectual properties.

The Atari Jaguar is a video game console that was released in November 1993 to rival the Mega Drive/Genesis and the Super Nintendo Entertainment System as a powerful next generation platform. Promoted as the "first 64-bit system", it proved to be a commercial failure and prompted Atari to leave the hardware business. Despite its commercial failure, the Jaguar has a large fan base that produces homebrew games, making this console a cult classic.

The Jaguar was the last game system to be marketed by Atari Corporation. Flare Technology, a company formed by Martin Brennan and John Mathieson, said that not only could they make a console superior to the Sega Mega Drive or the SNES, but they could also be cost-effective. Impressed by their work on the Konix Multisystem, Atari persuaded them to close Flare and, with Atari providing the funding to form a new company called Flare II.

Flare II initially set to work designing two consoles for Atari. One was a 32-bit architecture (codenamed "Panther"), and the other was a 64-bit system (codenamed "Jaguar"); however, work on the Jaguar design progressed faster than expected, and Atari canceled the Panther project to focus on the more promising 64-bit technology.

The Jaguar was released in November 1993 for a sale price of $249.99, under a $500 million manufacturing deal with IBM. The system was initially marketed only in the New York City and the San Francisco Bay areas. A nationwide release followed in early 1994.

The system was marketed under the slogan "Do the Math", claiming superiority over competing 16-bit systems. Initially, the system sold well, substantially outselling the highly hyped and publicized 3DO, which was also released during the holiday season of 1993; however, the Jaguar could not shake the perception of having poor games after several dismal launch titles. It finally had its first hit game with Tempest 2000, and other successful games like Doom and Wolfenstein 3D followed. The most successful title was Alien vs. Predator which, along with Tempest 2000, is often considered one of the system's defining titles.

Through its lifetime, the Jaguar had an overall low number of titles due to being difficult to develop for. This was due to bugs in the released hardware (such as a memory controller flaw that could halt processor execution out of system RAM). Customers complained the Jaguar controller was needlessly complex, with over 15 buttons.

By the end of 1995, after the entrance of the Sony PlayStation and the Sega Saturn, the Jaguar's fate was all but sealed. In an interview,[2] Sam Tramiel, CEO of Atari, touted that the Jaguar was much more powerful than the Saturn and slightly weaker than the PlayStation. He also predicted the price of the PlayStation to be $500 and said that any price from $250 to $300 would be price dumping and that Atari would sue to block sales, which they never did. His comments were selected as #3 in GameSpy's Top 25 Dumbest Moments in Gaming.

In a last ditch effort to rescue the Jaguar, Atari tried to play down these two consoles by proclaiming the Jaguar was the only "64-bit" system. Technically-minded gamers debated the merits of Atari's claim: some felt the Jaguar's principal "64-bit co-processors" were simply graphics accelerators, requiring external control from the Jaguar's primary processors; the primary GPU executed a 32-bit instruction-set, while the remaining CPU (68000) was already established to be a 32-bit unit. Others countered that the mere presence of 64-bit ALUs for graphics, was sufficient to validate Atari's claim. Design specs for the console allude to the GPU or DSP being capable of acting as a CPU, leaving the Motorola 68000 to read controller inputs. In practice, most developers used the Motorola 68000 to drive gameplay logic and AI.

Finally, in mid-1996, Atari ran early-morning infomercial advertisements with enthusiastic salesmen touting the powerful game system. The infomercials ran most of the year but did not significantly sell the remaining stock of Jaguar systems.

Over the short life of the console, several add-on peripherals were announced. Yet only the Atari Jaguar CD drive and the JagLink (a simple two-console networking device) reached retail shelves. The voice modem and VR headset (with infrared head-tracking), existed in prototype form, but were never commercialized. (See Loki and Konix Multisystem for early development.)

After the Atari Corporation properties were bought out by Hasbro Interactive in the late 1990s, Hasbro released the rights to the Jaguar, declaring the console an open platform and opening the doors for homebrew development. Several game companies, including Telegames, ScatoLOGIC, and Songbird Productions, have not only released previously unfinished materials from the Jaguar's past, but also several brand new titles to satisfy the system's cult following.

Some time later, Imagin Systems, a manufacturer of dental imaging equipment, purchased the molding plates for one of the Jaguar's casings as, with minor modification, it was the right size for housing a camera.

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