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After six long years, one source told Kotaku that Final Fantasy Versus XIII has been cancelled. The game was reportedly cancelled a few weeks ago, and Square Enix decided not to officially announce it.
Information for Final Fantasy Versus XIII had been released at few and far between intervals since the debut trailer was first shown in 2006. Designer Tetsuya Nomura told Famitsu magazine back in March, "We're almost done with preparing the latest info for the game … Because of a totally unrelated reason, there are circumstances in which that info cannot be released."
There is a chance that the game could eventually make an appearance in another form. Kotaku’s source said that the resources for the game had been moved to another game, perhaps Final Fantasy XV.
When contacted for information, Square Enix told Kotaku "We have no information on the status of Final Fantasy Versus XIII, but will be sure to update you as it becomes available."
Square Enix does have a Final Fantasy event scheduled in late August, although if it will officially announce the status of Versus XIII is unknown.