Darkwood contains three different difficulty settings. As of now, they all simply revolve around player death and the severity of the punishment for dying. The difficulty modes cannot be changed on the fly.
The difficulty settings are as follows:
"The forgiving mode. When dying, you drop a part of your equipment."
The player has unlimited lives and drops a randomly selected half of their items upon death. The dropped items are stored in a backpack where the player died, which is marked on the Player Map with a blood spatter.
"The unforgiving mode. You have a limited number of lives. After that, it's game over."
The player starts with four lives, which are displayed as skulls on the HUD next to the health bar. Like in Normal mode, the player drops a randomly selected half of their items upon death.
"The ultimate thrill. Death is permanent."
The player has only one life.
In Chapter One, losing the final life result in the player's save file being deleted. On chapter two, the player will restart with some very basic equipment and some starting essence.[unconfirmed]