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After being defeated by Kyo Kusanagi in the King of Fighters '94 tournament, Rugal Bernstein returned with a vengeance. He sponsored a second tournament, King of Fighters '95, and invited most of the 94 teams to participate. This time Rugal had an ace up his sleeve; he had somehow gained access to an enormous source of power and he planned to use that power to destroy Kyo. However that power was to mean Rugal's own destruction. During his climactic battle with Kyo he lost control of his power, and it destroyed him.
With Rugal dead, a new sponsor emerged to host the next tournament. But this time things would be slightly different. King of Fighters '96 would throw off the tournament's tradition of secrecy; instead the matches would be broadcast on TV all over the world. The rules were still the same though, team match-ups with three fighters on each team. Each team sends out fighters one at a time, and the winning team is the one with fighters still standing.
This time around there are nine teams to choose from. Most of the teams and characters from the previous tournaments have returned, with some exceptions. Heidern has retired from his team, putting his student Leona in his place. The Art of Fighting team's Takuma Sakazaki has also stepped down, and sent his daughter and former Team England fighter Yuri Sakazaki to replace him. To fill the slot Team England recruited Kasumi Todoh from Art of Fighting 3. For his second tournament appearance Iori Yagama has a pair of new teammates in the form of Mature and Vice. And to top it all off three boss characters from previous SNK fighters, Geese Howard, Mr. Big, and Wolfgang Krauser, are making their debut appearance in the new KOF tournament.
Players can choose three fighters from the same team, or can mix and match three fighters from different teams. In addition to their usual special techniques, fighters also have access to desperation moves. These desperation moves do a great deal of damage when they connect, and can be used when the character's power meter is fully charged or when the character's life bar is very low. This game also modifies the KOF teammate help system a bit. In previous KOF games whenever characters were dizzy and on their side of the stage active teammates can be called on for help. In King of Fighters '96 character relationships with each other determines whether teammates will help each other out in this way. ~ Kyle Knight, All Game Guide