Beyoncé has settled a $100 million lawsuit with a dance-game developer.

The 31-year-old singer was sued by Manhattan-based Gate Five in 2010.

Executives from the company claimed they had signed a multi-million dollar deal with the star to work on an interactive game called Starpower: Beyoncé, according to the New York Daily News.

The newspaper reports players would imitate Beyoncé and "get praise on their moves, or advice on how to improve, from the singer in her voice".

According to the suit, Beyoncé pulled out of her contract in December, 2010. The claim alleged she put 70 people out of work during the holiday season by doing so and cost Gate Five millions in lost research and development.

Lawyers for the company also claimed she made "extortionate" demands at the last minute.

Beyoncé's lawyers reportedly argued she backed out after the company lost its financial backers and after new investors decided her 40 per cent share was too high.

The star has now decided to settle the matter quietly.

A website for the Manhattan Supreme Court indicated Friday a deal had been reached.

Terms of the settlement have not been released.

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