Shattered Memories is the most exciting Wii game I've played all year, and by quite some distance, too. On paper, it's just a remake of the first entry in the Silent Hill series - but rather than simply going over old ground with a new lick of paint, Climax Studios has used this opportunity to tear up the rule book completely. The end result is a braver, more streamlined Silent Hill, and on the basis of what I've seen so far, it could well be a vital shot in the arm for the whole franchise.

I first encountered Shattered Memories at E3 in June. At the time I was fairly impressed with what I saw, but a bustling convention centre is hardly the best place to assess a project like this. This week, with the benefit of time, our own preview code and a decent pair of headphones (essential for any survival horror outing, in my opinion), I've been able to fully appreciate the game's prowess. For a start, it looks brilliant - and not just in a cop-out "pretty good for a Wii release" kind of way. The lighting effects are superb, particularly when using the all-important torch, while the voice acting and ambient music are of a consistently high standard. Shattered Memories is easily one of the most technically accomplished games to show up on the Wii, and yet it's the changes to the gameplay that have really caught my attention.

As with the original Silent Hill, Shattered Memories is the story of a troubled writer named Harry Mason. At the start of the game Harry crashes his car after hitting a patch of icy road, and when he regains consciousness he discovers that his daughter, Cheryl, is missing. He immediately sets out to find her, ignoring the fact that he may have serious head injuries. The town of Silent Hill is almost completely snowed under, but it soon turns out that this is the least of Harry's problems.

So far, so traditional - but Shattered Memories mixes things up with the introduction of what I presume is a flash-forward subplot, in which Harry discusses his ordeal with a psychiatrist. These interludes take the form of interactive cutscenes, viewed from a first-person perspective. At select points your therapist will ask you questions that must be answered by "nodding" or "shaking your head" with the Wii Remote, and he'll also get you to undertake other activities as part of the therapeutic process. But these exercises aren't just there to add to the atmosphere; your responses in these sections will determine the way the game treats you, altering everything from level layout to the way you are treated by other characters.

These choices are brought into play right from the start, and one of your first actions in the game will be to fill out a short questionaire of yes/no questions. Among other things, you'll be quizzed about your drinking habits, how sociable you are, and whether or not you enjoy roleplay during sex. I was sceptical about just how much impact these choices would have, but having played through the first section twice, giving different answers each time, it seems that they really do make a difference.

Don't shoot yourself just yet! The Wii will be getting Silent Hill soon.

On my initial run-through I played Harry as a booze-loving socialite who values his family; during my first half hour of play, I was forced to move through a dressmaker's store, where a prom dress played an important role in an early puzzle. Soon after I met my first NPC - a friendly bar lady in an empty pub. On my second attempt, I played as a cold and sober introvert, and this time my path took me through an electronics store where someone had been making porn films; a TV replaced the dress as the object I needed to find. Instead of the barwoman, I ended up meeting Cybil the cop in a deserted diner. Cybil was cold and unhelpful towards me, ostensibly because I told the quack that I found it hard to make friends - and yet when I met her in the other game, she was as nice as pie.

I don't have time to list all the differences I spotted, but take it from me that there were a lot of them - including everything from billboards to Harry's reaction to in-game objects. In theory this automatic customisation is a reflection of a psychological profile that the game builds for each user, and there's even a cute little warning screen about this when you first boot up the Wii. I'm not sure whether all this will really result in a scarier game, but it's certainly unnerving when you turn up at your house to find it looks almost exactly like it did in the badly-coloured-in drawing you did for your therapist.

It might be a good idea to start running now...

It makes sense that Climax is spending a lot of time tailoring its world, because it's arguably playing an even more important role than in previous Silent Hills. In past games your environment would frequently shift between its usual state and a demonic, Hell-like doppelgänger, but either way you'd still be getting up to the same stuff: walking around, shooting or bludgeoning monsters, and solving the odd puzzle. Now there's a greater distinction between the two dimensions. When things are normal - or normal for Silent Hill, at least - the gameplay will emphasise puzzling. You'll steer Harry around with the Nunchuck, using the Remote to guide the camera, which is synced to your impressively pretty flashlight. Holding the B trigger will zoom your vision, the A button lets you interact or inspect things; pushing the two together will allow you to "pinch" and manipulate certain objects, indicated with subtle white arrows. I've only played the first two hours or so of the game, but so far the puzzles have largely been tied to specific locations. There's no dedicated inventory system, so if you need to find a key it will usually be fairly close by. The puzzles I've encountered have been pleasingly logical, and there's always a sense that Harry is simply trying to do what he must to continue his search.

Aside from his bare hands, Harry's main tool is his smartphone - a gadget that fulfils several roles. For a start it acts as a sort of detector for ghostly activity, spewing out interference noise in the same manner as the radios in previous Hills. The GPS function gives you a map and helps to steer you towards objectives, and you can use your mobile to dial any number you come across on your travels (while stumbling through the town's high school I found a piece of graffiti about a slutty student who would perform "favours". Naturally I called the number, but the end result was a bit creepy, and it made me feel like a bit of a pervert). Finally, the phone's camera function can be used to detect ghosts, revealing what the human eye can't see. As you might imagine, this often results in a jump or two.

You may have noticed that I've not yet mentioned combat or monsters; that's because Shattered Memories is a bit of a departure from its predecessors - and indeed from survival horrors in general. While you'll frequently encounter ghost-like spiritual echoes and other supernatural goings-on, Harry will only directly face enemies when the world shifts to the Nightmare Realm. At this point the world freezes over completely: ice spreads over the entire world, frozen walls arise to block your progress, and snowflakes are left hanging motionless in the air. But you're not alone in this icy wilderness: the world is full of faceless white creatures, freaks that look like something from a Guillermo Del Toro film, and they're disturbingly good at hunting you through the slippery wastes.

To make matters worse, Harry has no direct way to fight them. That's right, folks - your only option is to run for your life. From time to time you'll find a flare that can keep your foes at bay, Alan Wake style, but other than this, your only options are to hide or to keep moving. If you find a bed to crawl under or some other form of protection, you'll be forced to watch your pursuers through a restricted view as they stalk about the room. If they leave, you'll have an opportunity to get away, but if you wait too long the monsters will sniff you out. In other words, hiding is a short term solution. In the long run your only hope is to find the exit door by dashing headlong across the map, desperately searching the horizon for the blue outlines that give clues to paths you can take.

Key-In-A-Frog: The ideal Christmas gift for all the family

I've no doubt that some gamers will baulk at the absence of combat, but personally I think it's a great idea. By depriving you of weapons, Shattered Memories forces the player into a position of weakness. Most survival horrors eventually turn you into an efficient killing machine, but here you should always be the terrified quarry. Anyone who's played any of the early Clock Tower games will know how scary this setup can be, and since the Resi series has turned itself into an action franchise, it's refreshing to see Konami and Climax putting fear first. Even the Wii's motion controls work well: when a monster grabs Harry, you'll have to throw it over your shoulder by making similar gestures with the controllers - an action that actually feels natural, for once.

The only concern I have with Shattered Memories is that it seems that you can't actually die; if the monsters do drag you to the floor, you'll have to start your flight again from what appears to be some form of invisible checkpoint. Player death and the accompanying fear is a major ingredient of the horror genre, so this is a controversial design choice. Still, the rest of the game has been handed immaculately, so for now I've got faith that Climax knows what it's doing. Everything about Shattered Memories screams of quality, from the sleek graphics to the strange, home video-like presentation of the menus - a touch that feels like a nod and a wink to Austrian director Michael Haneke. In short, I'm dead eager to play more. The game is due out in the US before Christmas, but here in Europe we'll have to wait until early next year. Something tells me that it'll be worth it.

Silent Hill: Shattered Memories will be released on Wii, PS2 and PSP in early 2010.