DreamWorks movie director Januel Mercado shared a cautious but clearly interested take on a potential Forgotten Island 2. The 2026 DreamWorks Animation original fantasy-comedy, rooted in Filipino folklore, marks a major milestone as the first Hollywood animated feature set in the Philippines. Forgotten Island, which premiered on September 25, revolves around two best friends, Jo (H.E.R.) and Raissa (Liza Soberano), whose friendship is tested after they embark on an adventure into Nakali, an island populated by creatures from Filipino mythology. This same world threatens to erase their shared memories in exchange for going back to the real world. The movie ended on a happy note for Jo and Raissa as they both returned to the real world, leaving the door open for them to return to Nakali once the portal reopened in the movie's final moments.
Speaking exclusively with The Direct, director Januel Mercado addressed the possibility of Forgotten Island 2, hinting that a sequel could still happen while pointing to "questions that remain unanswered" in the first film:
The Direct: "Do you have an idea for 'Forgotten Island 2'? Are you ready? Do we have it sitting in the wings for the green light?"
Mercado: "I will say because we've been kind of trying to live in the moment and stick the landing... However, the answer to your question is that there are many things in the movie, questions that remain unanswered, that provide a path to [a possible sequel]."
Mercado also teased that Forgotten Island had only touched the tip of the Nakali-shaped iceberg, leaving still unexplored. He hinted that there is a "bigger world" and the characters introduced in this hidden dimension had "histories and stories" that had started long before Jo and Raissa arrived on the island:
"There is a bigger world with the 'Forgotten Island,' and these characters have histories and stories that have started long before the audience goes in the theater and even before Jo and Raissa get to the island, so they're there."
While DreamWorks has yet to officially greenlight a potential sequel, Mercado's latest comments suggest that he, at very least, is eager to tell more stories set in Nakali and potentially beyond, expanding the universe while introducing more Filipino creatures and pushing them to the forefront.
Forgotten Island delivered an emotional ending that sets the stage for future stories in a hypothetical sequel. Raissa walked away from Jo after learning that she had hidden the sand dollar portal because she could not stand to see her best friend leave for Caltech. Jo felt guilty afterward, which is why she bargained with Batiba (the memory demon voiced by Jenny Slate) to give up her own memories of their friendship so Raissa can go home.
Raissa forced her way back to Nakali, helping Jo recover her memories, and proved to Batiba that the foundation of their friendship is stronger than the magic she forged. The epilogue showed Jo is now a graphic novelist who turned her adventures with Raissa in Nakali into a book, while Raissa is now a successful student at Caltech in California.
The fact that they can open a portal to Nakali whenever they want to clearly allows many storytelling opportunities for a sequel, meaning that their Wolf Pack, led by Dave Franco's Raww (who is way older than expected in the film), can summon them whenever trouble arises in the hidden world.
Forgotten Island 2 Already Has the Perfect Story to Explore
Forgotten Island's ending left a dangling cliffhanger that is already worth exploring in a potential sequel: the origins of the Mananggal (aka Manang). The film introduced Manang as a terrifying aswang (inspired by the vampires in Ryan Coogler's Sinners) who pursued Raissa and Jo throughout the film after they stole her wings. The film's climactic moments quietly rewrote her origins, turning her into a sympathetic character.
Forgotten Island revealed that Batiba had taken Manang's memories, which explained her constant agitation. Once those memories came back, the villain stopped being a hunter and became someone who could be reached. The first movie didn't really explain her origins or how her memories changed her, and this dangling thread leaves the door open for it to be either the main story or a side story in Forgotten Island 2.
The sequel could explore who she was before the split. In Filipino folklore, a mananggal is human by day and a monster by night. The follow-up could turn that into a tragic story, potentially exploring how a human who accidentally wound up in Nakali became an aswang.
Forgotten Island also confirmed that Jo's grandmother had already visited Nakali and survived. It's possible that part of Manang's memories were her encounter with Jo's grandmother, which could explain why she didn't attack them again after the restoration of her identity.
Other sequel ideas in Forgotten Island 2 could revolve around the aftermath of Batiba becoming an ally rather than another villain, Raww's life now that he has newfound friends, and a brand-new threat that could threaten Nakali and would require the help of Jo and Raissa, where they need to band the Filipino folklore creatures together to make a stand.
