According to reference code found in the recently released Source Filmmaker, the Source 2 engine is currently in development.
The reveal comes thanks to valvetime who reports there’s no less than 60 references to the new engine contained within the code. The Source Filmmaker code, as pointed out, explicitly references “Source 2″ as well as the buzz word “next-gen”. Here’s what it looks like:
”Return an str with the current engine version. If key doesn’t doesn’t exist, assume ‘Source’, otherwise invalid — assume next-gen ‘Source 2′”.