Unreal Engine 4

Considering the large amount of current-gen games that run on Unreal Engine 3, Epic Games showing off its next engine is big news. One thing is for certain: It did not disappoint. Between the eye-catching particle effects to the detailed lava that realistically glowed as it flowed downstream, Epic's Elemental demo looked like a Blizzard cinematic. Except, there is one key little detail: This was all being done in real time on hardware that we aren't far off from having in our own PCs and consoles.

Take a look at the gorgeous demo above and then we'll start breaking down the important features going on within it:

• Global Illumination System

In real time, all light sources can be moved and completely changed without effecting render time for a scene. There is no re-calculation necessary. While this is good news for developers, it also means a lot for everyone that plays games. Where developers once needed a painterly hand to build these scenes, now complex lighting will dynamically happen within the engine, opening up the possibilities for how designers can present their world. The orange hue of a player's flashlight can naturally clash with the blueish tint of a room's lighting, creating an immersive, natural environment unlike anything Unreal Engine 3 could accomplish.

• Dynamic Textures

As you may have discovered, nothing can ruin or build the reality of a virtual world quite like textures can. Whether it's the shallow, stretched textures of a budget Wii game or the massive textures of Max Payne 3, this is a key aspect of games that continue to evolve alongside tech engines. UE4 is taking things to the next level by creating dynamic textures and materials that can absorb and reflect lighting. Factors such as object temperature, material type, and room lighting will change how objects react to light. An opaque object and a heavy, heated object will treat light in completely different ways true to their defined feature set. UE4 makes materials feel alive and complex.

• Advanced Particle Effects

Ever since Unreal and Unreal Tournament, particle effects have largely defined what we call "eye-candy" in games. Seeing smoke, fire, and other particle effects come closer to reality has been a treat for a long-time game enthusiasts. UE4 takes things a couple notches further with particles increasing in number and being able to reflect light in real time. You can walk around a smokestack and see how different it looks with the sun in front of it and behind it. Even more impressive is the ability to simulate over a million of particles on screen through GPU computing.

Luminous Engine

Square Enix's tech has been at the forefront of every console the company has been a part of. Just like how its Final fantasy VII PS3 tech demo teased and blew away audiences in 2006, its recent Agnis Philosophy demo set a new standard for next gen with incredibly detailed player models, realistic lighting, and particle effects that give UE4 a run for its money. Even the physics on the animal's hair and detail of the girl's feathered dress in this demo are realized with great detail and depth. Unfortunately, we don't know much about what's going on beneath the hood, so you'll just have to bask in the gorgeousness of the above demo. In good news, unlike the FF7 tech demo, Square Enix is asking fans if this is a game/world they'd like to see realized. So, go fill out this survey if you'd like to see this more realistic, gritty take on Final Fantasy get made.

CryEngine 3

While CryEngine 3 has been around since the launch of Crysis 2, developer Crytek showed off some noteworthy improvements to the engine at E3. The engine now supports very-high tessellation that smooths out facial structures, making them look much more realistic and smooth like those found in Heavy Rain. The engine also introduces adaptive tessellation on textures, taking a flat texture of a brick wall and turning it into a complicated, jagged structure with thousands of polygonal points. More than any other engine mentioned here, CryEngine is about giving convenience to designers. For example, the engine now enables automatic navigation for AI units in levels. All you need to do is dictate the constraints and the engine will figure out what objects they should have access to and how they'd reach them.

Star Wars 1313

It's hard to believe this is running on Unreal Engine 3, the same one that introduced us to Gears of War, six years ago. I guess anything can be made possible when you get Industrial Light and Magic involved. Without a doubt, this was the best-looking game of this E3. Maybe, it will be the best-looking one next year, as well.

Watch Dogs

Ubisoft created a new engine to run this E3 demo which was running on an advanced PC, even though the game is slated for current-gen consoles. It's difficult to believe that such advanced lighting and reflections can be done on current hardware. Nevertheless, the visuals were a big reason of why this demo left such an impact.