Earlier this year, students at the DigiPen Institute of Technology submitted a game to 2006 Independent Games Festival which is still causing people to rethink gameplay. Their senior project, Narbacular Drop, relied on a unique way of placing portals around a maze to navigate from one end to another. It's a physics-y puzzle game at its heart, and was extremely innovative.
Our favorite physics-loving company, Valve, caught notice and had the team start porting the game to its Source engine. And now it appears that Valve is adding this game to Half-Life 2: Episode 2.
Of course, soon as Valve started showing of the game (see it yourself via YouTube or GameVideos), the sites became abuzz. The Ars Technica article says it all: "[The] video makes my brain hurt in all the right ways."
Mixing this with the right physics toys would definitely make a very innovative physics game... or FPS... or... anything. It's one of those ideas that sends ripples throughout the industry - expect to see this sort of portal-play popping into games as soon as developer's grubby little neurons can wrap around the coding. And really, the coding has got to be clever... just think of the math you'd have to perform in order to get a recursive portal to render.