There are currently no indications that Halo features deformable terrain. This was never more than a rumor.

Not strictly speaking, at least not in the sense that objects are persistent in massively multiplayer online games like Ultima Online or their ilk, although it was speculated that Halo might utilize such an architecture early in its development.

Bungie has stated that within the solo campaign, objects are persistent in the sense that if the player sacks and destroys a Covenant base, it will stay that way unless there's action taken to change that.

A particle effect weather system certainly exists, and such environmental effects as snow have been displayed. And where there is snow, there will likely be rain, and probably other assorted effects.

Early on it was speculated that Halo might operate like a simulation, with real-time cycles of day and night based on the geometry of the Halo system and a realistic physics system.

While the physics of Halo's engine are certainly quite advanced, there's been little reason to believe that at this point it takes into account such celestial events.

Possibly yes. One account describes the ambient life as being very big, perhaps large enough to ride on, and possibly intelligent.

The demonstration movie from E3 in 1999 featured two kinds of ambient life-- a large, dinosaur-like creature, and a herd of small, toothy animals.

However, neither has been seen in any builds of Halo since that time, and it is not known if they will be present in the Xbox release version of Halo or subsequent versions.

Soell is the unofficial name of the Halo system primary star, named for Bungie's Matt Soell. There is the possibility that there is more than one star in the Halo system, as suggested in the second Cortana letter quote the suns are shining, but little other information is available.

Basis is the official name for the moon of Threshold which the Halo orbits with. Little else is know about it, except that it has been called Zartmoon and Seropia in the past.

Threshold is the name of the large, orange colored planet seen in the demo hologram room sequence. According to a Bungie preview quote, it is a large gas giant planet, and the ringworld orbits it on a halo (or lagrange) orbit between it and a smaller moon planet.

One of the possible connections between Halo and Marathon is the idea that the Halo is of Jjaro (or Jjarro) origin. This race had the ability to move entire moons through space.

The Halo is a ringworld that may be crucial to tipping the scales in the war between the humans and Covenant.

It is believed to be an ancient artifact of a long departed race (perhaps the Jjarro of the Marathon series).

The Covenant is a alliance of three alien races, believed to be fanatically religious, and engaged in a war with mankind. They are very advanced, but for some reason see the player as their Devil-it has been hypothesized that this is because the player is a cyborg, which may be taboo in their culture.

In addition to the humans and the Covenant races, there is apparently a third race that appears in Halo. They are possibly the constructors of the Halo and/or residents of it.

Cortana is a shipboard AI (articificial intelligence) from the human craft Pillar of Autumn. Apparently the Covenant are after her, and it's your job to stop them from getting their hands on her.

Early in Halo's development and long before its announcement, several emails were sent from computers at Bungie under the name Cortana that elicit connections the Marathon universe and possibly AIs from that story, perhaps Durandal.

Originally at Haloplayers.
It's Halo Update Birthday Party time here at Bungie HQ. Bungie-blue balloons stamped with Halo logos carpet the ceiling. Strategically-placed strobes and disco balls spackle the room with light. In the portion of the office formerly known as the Oni room, a band is playing. Liquor and laughter flow in equal measure. And here I sit at my desk, trying to think up what may very well be the last Halo Update.