No federal charges will be brought against 38 Studios, the Kingdoms of Amalur firm that went bust after receiving a tax-payer backed state loan of $75 million.
The US Attorney's office in Rhode Island told the Press Association that it had conducted a review of 38 Studios to see if any federal laws were broken, including bank fraud.
"No further federal action is planned at this time," a spokesman said.
However, an investigation into whether any state laws were violated "is still being pursued".
38 Studios, which was founded by former Red Sox pitcher Curt Schilling, declared bankruptcy in June.