Capcom had a string of successful titles in the late 1980s, and to round off the year they created a new arcade hardware system called the CPS-1. One of the first games to use this hardware was Final Fight, a scrolling beat 'em up which featured extremely impressive graphics for the time -the sprites were large, well animated and the backgrounds of each level were very detailed. The story involved Mayor Mike Haggar trying to rescue his daughter from the clutches of the Mad Gear gang, who had also taken over Metro City. Haggar is helped by Jessica's boyfriend, Cody, and Guy, one of Cody's friends.

Yoshiki Okamoto was the director for Final Fight. Yoshiki had previously worked on games for Konami (most notably Gyruss and Time Pilot) and some Capcom games, such as 1942. He has said that when working on Final Fight, he took inspiration from Double Dragon II: The Revenge, another scrolling beat 'em up by Technōs. The development team also clearly watched Streets of Fire, a movie from 1984, to get some ideas for the characters and story together.

When Final Fight was released in December 1989, it went on to sell over 80,000 units in America alone, a phenomenal amount. The game was one of the biggest arcade successes around, and it also helped sell lots of CPS machines to arcade operators. A few years later, Final Fight would be available on many different consoles, such as the Super Nintendo, SEGA CD and more. And even now the game it still seeing releases on current generation consoles, such as the Xbox 360.