The season two finale, The Doomsday Project (1994) (which was also the final episode), ended with a cliffhanger indicating that Snively was going to take over as the new primary villain on the show starting in season three, and he also revealed that he had a new partner, who was only indicated by red, glowing eyes. Contrary to popular belief that these eyes belonged to Knuckles or Metal Sonic, writer Ben Hurst revealed that they actually belonged to Naugus. He explained that the plans for the third season were: Snively tries to retake control of Robotropolis, but ultimately fails. On the verge of losing it all to the Freedom Fighters, he turns to The Void (1994), where Naugus is busy torturing Robotnik. Snively frees Naugus, and in the process also frees Robotnik and King Acorn. Naugus assumes control, and starts his new command by trying to lure Sally into capture with the King as bait. Robotnik becomes Naugus' lackey. And Snively, now reduced to a simpering nobody, defects to the Freedom Fighters. Hurst went on later to say that more developments would have come along between the relationship of Sonic and Tails, coming a little closer to the game relationship it strayed so far away from. Sooner on down the line in possible future episodes we would also have learned of the origins of Robotnik and Snively.
The third season would have seen Tails mature and played a much larger role as an official member of the Freedom Fighters, even showing a bit of a rebellious side and would save Knothole Village from a major disaster. Furthermore, his relationship with Sonic would have been closer to the games.
A third season was planned, hence the cliffhanger at the end of the series. The series was cancelled due to losing ratings to Mighty Morphin Power Rangers (1993).
Dulcy the dragon was added to the series during season two, because the show's staff wanted another heroine in the cast along with Sally and Bunnie.
According to Ben Hurst, Robotnik and Snively's back story would have also been revealed. Robotnik and Snively were originally from Earth (Mobius' past) and in the year 2200, attempted to take over the space colony in which they were living. Inadvertently destroying it instead, Robotnik and Snively narrowly escape with their lives, and were somehow sent into the distant future where they return to Earth, only to find it had become Mobius. Thinking that he was superior to the sentient animals that inhabited the planet, Robotnik set about to conquer it in any way he could.