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The Sega Dreamcast ( Japanese: ドリームキャスト; code-named "Katana" and "Dural" during development) was Sega's last video game console. After the Dreamcast was discontinued, Sega withdrew from the console hardware business.

The Dreamcast was released on November 27, 1998, in Japan and on September 9, 1999 in the US—long before other consoles of its generation were available. It was also the first console that offered online play. The Dreamcast enjoyed brisk sales its first season and was one of Sega's more successful hardware units. It was an attempt to break into the console market with a next-generation system designed to supersede Sony's PlayStation and Nintendo's N64, but mainly because of doubt (some Sega add-ons and consoles have been less than successful, such as the 32X and Sega CD) and anticipation of the Nintendo GameCube, Sony PlayStation 2, and MicrosoftMicrosoft Corporation , headquartered in Redmond, Washington, USA, is the world's largest software company (with over 50,000 employees in various countries, as of May 2004). Microsoft develops, manufactures, licenses and supports a wide range of software XboxThe Xbox is Microsoft's game console, released on November 15 2001. It is Microsoft's first independent venture into the console arena, after having collaborated with Sega in porting Windows CE to the Sega Dreamcast console. The price is currently 149 USD, it lost a lot of steam, and Sega began to lose money once again. In JanuaryJanuary is the first month of the year in the Gregorian Calendar, and has 31 days. It is named for Janus, the Roman god of doors and gateways. The original Roman calendar consisted of 10 months (304 days). The Romans originally considered winter a monthle 20012001 is a common year starting on Monday (see link for calendar), and also: The International Year of the Volunteer The United Nations Year of Dialogue Among Civilizations Events January January 1 A black monolith measuring approximately nine feet tall ap, Sega announced that the Dreamcast was to be discontinued by the end of the year but that new games would still be made. This was the final blow that took Sega out of the home console business.

Dreamcast used a proprietary format called GD-ROMThe GD-ROM Gigabyte Disc Read Only Memory is the optical media used by the Sega Dreamcast (as opposed to a standard compact disc). GD-ROMs have the capability of holding a maximum of 1 GB of data, rather than the standard 650-700 MB of a CD. Developed by for storing games in order to foil software pirates, a strategy that ultimately backfired when the first run of discs had a high rate of defects, and pirates managed to pirate the games anyway. (In some cases, the pirated games were released before the legitimate versions.) Sega largely had themselves to blame for the high levels of Dreamcast piracy—their use of the GD-ROM format was completely undermined by the console's support for the Mil-CD format, which allowed the console to boot from a standard CD-R. Mil-CD support was removed from the final Dreamcast revisions toward the end of the console's life.

This was the first videogame console to ship with a built-in 56k modem, though broadband adapters were available later on. This allowed the system to connect to the Internet using a custom, fully-functional web browser and e-mail client. In fact, many games released for the Dreamcast came with online play modes, the most popular being Phantasy Star Online and the Sega Sports lineup (now published under the ESPN label). Although other consoles before the Dreamcast had network gaming support, such as the Sega Saturn's NetLink, the Dreamcast was the first game console to include this ability out of the box and is therefore considered the first Internet-enabled home game system.

The Dreamcast has a modest hacking enthusiast community. The availability of Windows CE software development kits on the Internet—as well as ports of Linux (LinuxDC) and NetBSD/dreamcast operating systems to the Dreamcast—gave programmers a selection of familiar development tools to work with, even though they do not really support the high speed graphics. A homebrew minimal operating system called Kallistios offers support for most hardware, while not offering multi-tasking, which is superfluous for games. Many emulators and other tools ( MP3, DivX players, and image viewers) have been ported to or written for the console, taking advantage of the relative ease with which a home user can write a CD which is bootable by an unmodified Dreamcast.

Sega released a board, using the same technology as the Dreamcast, called Sega NAOMI for use in arcade games.

Though the Dreamcast was officially discontinued in early 2001, commercial games were still developed for it and were released afterwards (though mostly only in Japan). On February 24, 2004, Sega released its final Dreamcast game, called Puyo Puyo Fever. A small number of third-party games are still being released.