In October 2024, Game Freak suffered a security breach when one terabyte of internal data including over 2,600 employee records were leaked to the public, an event that Pokémon fans referred to as the "Teraleak". The initially released contents of the leak included old builds and sprites for past Pokémon games, codenames for new games, the codename "Ounce" for the Nintendo Switch successor, concepts for a sequel to the Detective Pikachu film, details on the then-unreleased Pokémon Legends: Z-A, the codename "Gaia" for the next Pokémon generation, and details regarding a pitched Pokémon MMO codenamed "Rodeo".

The most widely publicized contents of the leak were scrapped early drafts for the Sinnoh myths from the Generation IV games that were loosely inspired by folklore from different countries. These generated controversy for inserting several Pokémon into violent and sexually deviant scenarios, such as Typhlosion in the Canadian indigenous myth of the Bear Mother, and Octillery and Ursaring in a twist on the Japanese erotic woodblock art The Dream of the Fisherman's Wife, of which the latter story seems to have been partially reworked into Veilstone's Myth in the final games. Game Freak would later address the leaks, stating that they had originally been breached in August of that year seemingly through a phishing attack. This statement did not acknowledge any of the leaked development material, but apologized to employees that had been put at risk by the incident.