It takes a big man to admit his mistakes, and when it comes to his problems with Fable II, designer Peter Molyneaux is as gigantic as his reputation. During our demo of Fable III, Molyneaux laid out all of his criticisms of the series, and detailed exactly how Lionhead Studios is going to fix them.

Molyneaux started the demo with a stark admission: He didn't like Fable II's story, and considers it generic and forgettable. With Fable III, the team at Lionhead set out to craft a story that is instantly understandable and appealing: Your mission is to amass enough power and fame to overthrow the tyrannical dictator of Albion, then step into his shoes and rule the land yourself. Your coronation will come roughly halfway through the story, and introduces a variety of new gameplay elements, as you allocate your kingdom's wealth, settle disputes brought before you in court, and decide whether to honor or forget all the promises you made to your supporters on your rise to power. You'll still have the ability to travel the countryside slaying hobbes and searching for treasure with your trusty pooch - but you'll probably have to don a disguise in order to be left alone. Molyneaux stated players will learn certain truths about power, which may result in you acting more like your despicable predecessor than you would like.

Molyneaux's criticism of Fable II didn't end with the story: the worst part of the game, he told us, was the start button - the player was constantly drowning in statistics and lists and never really felt like they were leveling up or amassing a fortune. For Fable III, all of the items that were previously hidden in menus now reside in the Sanctuary, a series of rooms that house your various collections. Your faithful butler Jasper (voiced by the hilarious John Cleese) assists you in each of the Sanctuary's areas. These include a dressing room with the hundreds of clothing items you have acquired (Jasper will lay out select costumes for you on mannequins); an armory that displays all of the weapons you've collected or crafted; and a treasure room, which will slowly fill with mountains of gold as you accumulate wealth (there was also a co-op room, but Molyneaux wasn't talking about it yet). As Molyneaux showed off a long line of customized swords - the visual style of your weapons now evolve based on how you use them - it was instantly clear how much more rewarding collecting items will be in Fable III.

A variety of other improvements we saw reinvigorated our love of the series. Magic is now bound to enchanted gloves, which can be mixed and matched to create different effects based on each glove's level and ability. Co-op has also been revamped, now providing a complete experience: Your visiting friend can bring all of their weapons and powers into your game, and the two of you can travel independently to wherever you want in the world. Thanks to the new Victorian-era time period, the game has more of a distinct style than most fantasy games, too.

Molyneaux is infamous for making impossible claims about what his games will deliver to players, but from what we saw at E3, we are once again hopeful that Microsoft's seminal RPG won't disappoint fans.

[This preview originally ran in issue #208 of Game Informer]