"Fantasy Earth Zero" began production in 2001 as "Fantasy Earth: The Ring of Dominion", a small-scale online game project led by Enix. During this period, it was headed by George Kamitani, a developer whose previous work included fighting games for Capcom and the Sega Saturn game "Princess Crown". The project ballooned in scale, and to facilitate its development Kamitani created a small development studio dubbed Puraguru in 2002. The project was originally planned as a battle scenario between humans and vampires, but under Kamitani's guidance the scenario changed to a battle between princess-themed kingdoms. It was Kamitani's first time developing 3D graphics, and he recycled artwork and assets from "Dragon's Crown", a cancelled Dreamcast sequel to "Princess Crown". Production was originally placed in a small section of the Enix company building nicknamed the "submarine". By 2003, Enix had merged with Square to become Square Enix, and Kamitani stated that the newly-merged company took the project away from him. Kamitani and Puraguru left production in 2004, and development was taken over by Multiterm.