According to game's producer and graphics/VA Daisuke Ishiwatari in The PlayStation (JP) magazine interview, he was asked how long did it take to make the game? He responded:

"Once we got down to the actual development work, it took about a year and a half to complete. It was a very long interval, though, from the time we finished the planning docs to the time we started development."

He also revealed that the game was originally in development for the Nintendo 64, the Sega Saturn, and for arcades as well as the PlayStation, and that as a result, Ishiwatari put a lot of thought into designing the Instant Kill system, and that it only ended up the way it was in the final game when the team decided to make Guilty Gear exclusive to home consoles.
Contributed by ProtoSnake