Project Shield includes an integrated 'console-grade' controller and can run Android titles or stream from a PC's Steam library.
Nvidia has unveiled a handheld games console of its own at CES in Las Vegas.
Driven by an Android operating system and powered by an Nvidia Tegra 4 chip, also announced at the show, Nvidia's Project Shield boasts HD video capability, audio and wi-fi built into a 'console-grade' controller. Titles will be playable through its own flip-up screen or streamed to a larger television or monitor.
The handheld will run Android titles having access to the Google Play store and will also be able to stream games from a Steam library on a PC. Nvidia's press release does however state that PC needs to have an Nvidia GeForce GTX GPU installed for this to work.
'We were inspired by a vision that the rise of mobile and cloud technologies will free us from our boxes, letting us game anywhere on any screen,'
said Nvidia co-founder and chief executive Jen-Hsun Huang. 'We imagined a device that would do for games what the iPod and Kindle have done for music and books, letting us play in a cool new way.'
Project Shield also touts a micro-USB port for accessories, a microSD port and an HDMI video output port. Nvidia expects the console to ship in Q2 of 2013 and have not issued any details on pricing.
The handheld market is considered a difficult nut to crack and 2012 saw Sony struggle to gain market share with its new PSP Vita. Handheld consoles now also have to compete against the highly saturated smartphone market.