Building interactive worlds that respond coherently to player actions has long been a shared goal of computer graphics, games, and artificial intelligence. Recent video generative models provide a data-driven route toward this goal by predicting future observations conditioned on user actions, and are increasingly regarded as potential next-generation game engines. Realizing a genuinely interactive game world, however, requires interaction outcomes that follow rules over evolving game conditions, consequences that persist over long horizons, and a generation loop that operates in real time. Conventional game engines realize these properties through a recurrent action-state-observation loop, in which player actions update an explicit game state according to predefined rules and observations are rendered from the resulting state. Taking this loop as an organizing lens, this paper examines interactive game world modeling along four dimensions: player action control, game state dynamics, state-observation persistence, and real-time interactive generation. For each dimension, we start from the capabilities required by an interactive game world, group existing approaches into representative families, and discuss the strengths and trade-offs of each family. Complementing this analysis, we present a scalable data engine for Black Myth: Wukong that collects over 90 hours of gameplay with frame-aligned player actions, ground-truth game states, and visual observations, together with structured and semantic annotations, as a resource for state-aware game world modeling. We hope this paper offers a clear picture of where the field stands and fosters progress toward interactive game worlds.
Modern game engines spend significant compute animating NPCs with learned motion models. This paper proposes AI Level of Detail (AI LOD), a framework in which machine learning inference precision is adapted based on the distance between each NPC and the player camera. The core idea mirrors classical geometry LOD: substitute a cheaper approximation where the difference is imperceptible. Here, the approximation is a lower-precision quantized machine learning model rather than a lower-polygon mesh. The contribution of this work is the AI LOD concept itself: that inference-time quantization can serve as the LOD axis for AI-driven character animation - and more broadly, for any AI-based runtime system where perceptual sensitivity varies with context. The convolutional sequence-to-sequence model of Li et al. is used as a representative example to demonstrate the concept, with its trained checkpoint exported into three ONNX Runtime variants (FP32, FP16, and INT8 per-tensor), intended to be routed by a distance-based selector at runtime. Evaluation on the CMU Mocap dataset provides initial evidence that each precision tier can be served at its assigned distance range with negligible perceptible degradation, supporting the broader premise that distance-aware ML model precision selection is a viable LOD strategy for AI-based character animation.