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At 2007, released information about a slimmer and lighter version of the PlayStation Portable.

PSP-2000 The PSP-2000 (marketed in areas as 'PSP Slim & Lite' and still marketed as PSP in North America, Japan, China, India, Italy, and Portugal) is the first redesign of the PlayStation Portable. Many limited edition versions of the PSP that include various accessories, games, or movies have also been released. Despite the concerns, the PSP's North American launch was a success, although reports two weeks later indicated that the system was not selling as well as expected despite Sony's claim that 500,000 units had been sold in the first two days. Some expressed concern over the high price, which was almost US$20 higher than the system's price in Japan and more than $100 higher than the recently launched. Sony announced on February 3, 2005, that the PSP would go on sale in North America on March 24, 2005, in one configuration for a of 249/299. Different color variations were also sold in bundle packs, which cost more than usual, around $200. The console's launch was a success with over 200,000 units sold the first day. Launch On October 17, 2004, Sony announced that the PSP would launch in Japan on December 12, 2004, at a price of 19,800 (about 181 in 2004) for the base model and ¥24,800 (about US$226 in 2004) for the Value System. Several PSP game demos, such as 's and 's were also shown at the conference. In addition to announcing more details about the system and its accessories, Sony also released a list of 99 developer companies that had pledged support for the new handheld. Although some expressed concern over the lack of an analog joystick, these fears were allayed when the PSP was officially unveiled at the Sony press conference during E3 2004. The first concept images of the PSP appeared in November 2003 at the Sony Corporate Strategy Meeting and showed a PSP with flat buttons and no analog stick.

The PSP was called the 'first legitimate competitor to Nintendo’s dominance in the handheld market' by an analyst in 2004.

Later offerings from both SNK and Nokia also failed to cut into Nintendo's share. Nintendo had been dominating the handheld market since launching its in 1989, with the only close competitor being 's (1990-1997), as well as 's (1999-2003) in Japan. Several gaming websites were impressed by the handheld's computing capabilities and looked forward to the system's potential as a gaming platform.