Gamasutra has discovered that a canceled project at Ensemble Studios -- soon to be shuttered by Microsoft -- was in fact a Halo MMO. The game was supposedly in development in 2006 and part of 2007, which would jive with rumors that were circulating at the time. Gamasutra managed to dig up some of Ensemble's concept art and mocked up screenshots of what the game would have looked like. Taking a look at the screenshot, it's clear that the game's interface would have borrowed heavily from World of Warcraft, while the concept art shows off a dual sword wielding Spartan with what appears to be an AI companion standing (floating?) behind him. The 'magic' energy of the game was apparently refered to as Psion, so perhaps the AIs would have been part of the game's magic system.

Alas, the game is kaput, though it's unclear exactly why it was canceled. It could be that a similar game was also in the works, a likely possibility given how many teams are currently working on Halo projects. Then again, maybe it was canceled when Ensemble realized it would get pretty boring if everyone picks Master Chief.

[Thanks to everyone that sent this in. Via Joystiq]