In August 2023, several days following a controversy, Phisnom announced that he had been terminated from the Fazbear Fanverse Initiative and would no longer be developing Five Nights at Freddy's Plus. Prior to this, he had been banned from the game's Steam forums and removed as a developer. The day after he announced his removal, the game's Steam page was removed from the public, and on November 10th, all videos and posts related to the game on both Twitter and YouTube were made private, leading to the belief that the game had been cancelled entirely.

Original names suggested for the game were Five Nights at Freddy's 1.5, Five Nights at Freddy's REC and Five Nights at Freddy's RED, before eventually deciding on the final name Five Nights at Freddy's Plus.

The animatronics' design in Five Nights at Freddy's Plus were inspired by the old, neglected or in-disrepair animatronics from abandoned locations, such as the animatronics from the West Virginia restaurant Billy Bob's Wonderland.