Sora was built as an agency that would contract Sakurai as a freelance video game designer to different companies. His first project under Sora was designing Meteos with Q Entertainment. Nintendo's Satoru Iwata hired Sakurai, a long-time friend whom he had worked with at HAL Laboratory, to work on Super Smash Bros. Brawl. Development was supported by various other studios, including Game Arts and Monolith Soft, the latter now a first-party developer for Nintendo.
On 18 February 2009, after the success of Super Smash Bros. Brawl, Nintendo announced the formation of Project Sora, a subsidiary made to develop a new title directed by Sakurai. The development group was located in Tokyo's Idabashi area. It was officially formed on 22 January with capital of 200 million yen, of which 72% was provided by Nintendo and the remainder by Sora Ltd. and other parties. Sakurai served as the company's president. The studio began development with a staff of 30 (most of whom were recruits Nintendo hired for the development of Super Smash Bros. Brawl), with new recruitment constantly ongoing for a bigger development staff. Project Sora released Kid Icarus: Uprising for the Nintendo 3DS in March 2012. Project Sora was closed on June 30, and its closed website had a note: "The company was dissolved on June 30th, 2012. Thank you very much for your patronage so far. This website was closed on July 31st." Bandai Namco Games is collaborating with Sora Ltd. for the development of Super Smash Bros. for Nintendo 3DS and Wii U.