If you happen to visit the Irrational Games website today, you'll be greeted by "A Message From Ken Levine," co-founder and creative director. The message is a lengthy letter to fans, but the gist of it is clear – Irrational Games is shutting down.
Levine will be starting "a smaller, more entrepreneurial endeavor at Take-Two" with about fifteen members of the current Irrational team, which unfortunately means laying off a lot of people. He's not quite ready to announce this new "endeavor," but does state a clear goal: "To make narrative-driven games for the core gamer that are highly replayable." Interestingly, Levine was actually ready to jump ship and start his own independent studio, but Take-Two convinced him "that there was no better place to pursue this new chapter than within their walls."
For BioShock fans, it's important to note that this does not mean the end of the BioShock franchise. Levine and Irrational have handed the reins over to 2K Games and you can bet after the success of BioShock Infinite, there will surely be another addition to the franchise.
Source: Official Site