What is Mugen

M.U.G.E.N 2D fighting game engine created by Elecbyte that lets you create your own characters and stages. Oriented more towards flexibility, making characters with M.U.G.E.N may initially seem a daunting task, but once you understand the basics, learning the rest of the tricks should come naturally.

You can control almost every aspect of the engine to suit your tastes. That's the primary goal of MUGEN. Since this is a work in progress, there are many things that it can and cannot do, but here's a short list of some of the things you can do...

Customizable title and select screens, life and power bars, game sound effects, and fonts.
Characters can have any number of sounds and sprites of any size.
Up to 12 different color schemes for each character.
Background music can be mp3, mod, midi or CD audio.
Supports keyboard, joystick and Playstation joypads.

Use up to 6 buttons for a character (7 if you count the Start button).
Regular moves/Special moves/Supers.
Multiple air jumps.
Move cancel/2-in-1 or whatever you want to call it.
Multi-part moves/throws.
What your character can do is defined by how you build his state machine.

If you want to know more visit their site at http://www.elecbyte.com, for information how to start creating your own game and characters.