The game is currently being called Mario and Sonic at the Olympic Games and is supposed to be released by 4th Quarter of 2007. In the game you will compete in events that one would normally find in the Olympics (but of course this will be provided by Official Sponsers [in other words, be prepared for ads that are for real things]).
Sega announced that Mario, Sonic, Luigi, Knuckles, Yoshi, Tails are guaranteed to be in the game, with more on the way. Sega revealed that the game so far features racing, table tennis (how did that become a sport? It’s more like an activity), and swimming events. However they didn’t list the others (which we assume there will be more). Sega and Nintendo are working with ISM (they have the exclusive rights to Olympic Game related software/entertainment stuff).
So far the game doesn’t seem appealing, but that could all change…right?