The UD studio was working on the PS3 version of Quake Wars which is due out in the US on May 27th and on the 30th elsewhere.
Formerly known as Z-Axis they have developed many a game during the studios lifetime, it was bought by Activision in 2002.
"Activision is closing its Foster City development studio which had less than 45 employees," said a company spokesperson.
"We are currently making efforts to find opportunities for all employees at other Activision studios."
Other games from Z-Axis were X-Men: The Official Game, Aggressive Inline, Dave Mirra Freestyle BMX 2 and BMX XXX to name but a few.
