Sadly, it was scrapped. While we did eventually get a Phantasy Star 4, it was nothing like the one that was originally planned. Here are several things I've found about the title. If anyone knows anything else, please let me know.
From the July 1992 issue of GamePro magazine:
From Phantasystarwiki.com:Phantasy Star IV: The Return of Alis is due in 12 meg form for the MegaDrive this year. The CD version will be 20 times the size of the cart. The story involves an intergalactic slave trade and occurs right after Phantasy Star III, which rumor has it will also come to CD - suitably enhanced of course. Phantasy Star vets are fore-warned that the Alis connection is shaky. The name's in the game for nostalgia only, but rest assured that the Dark Force is involved.
From Wiki (since removed):Phantasy Star IV: The Return of Alis
Perhaps one of the least-known titles in the Phantasy Star franchise - Phantasy Star IV never saw a commercial release. Developed within Sonic Team shortly after the release of Phantasy Star III - Phantasy Star IV was to be the magnum opus of the Phantasy Star series for it's time. A game so large, that the only medium which could justifiably hold it was the Sega CD (though a stripped down Genesis version was also planned). It originally weighed in at over 240MB, much of which was fully digitalized music and FMV cutscenes. Though it also sported game maps 20 times the size of previous games and highly detailed 3D dungeon sequences similar to the first game.
Unfortunately, due to sagging sales of the Sega CD and numerous delays in the project - Phantasy Star IV was eventually scrapped and production resources were transfered to Phantasy Star: End of the Millenium.
Had Phantasy Star IV been allowed to finish development, it would have followed the events of Phantasy Star III and the continuing struggle against Dark Force. It's a fairly safe bet that at some point, Alis Landale would have made a return as well. Though part of the game still lives on through Phantasy Star: End of the Millenium. For example, the anime cutscenes which some consider to be the birth cries of modern FMV cutscenes, were inspired by the actual FMV cutscenes of it's unreleased companion.
From IGN:Wikipedia: http://en.wikipedia.org/wiki/Phantasy_Star_IV
Sega CD version
Phantasy Star IV was originally designed for the Sega CD system, and would have been vastly different from its final incarnation. This unreleased version was called Phantasy Star IV: The Return of Alis. Features like 3-D dungeons (such as those featured in the first Phantasy Star), full motion video cutscenes, voice acting, and much more were planned. Unfortunately, poor sales and lack of support for the Sega CD platform caused a change of plans midway through development. Most of these features were scrapped from the final design, the intended voice cast declined, and the end result was a Sega Genesis cartridge game that bore little resemblance to the original plans for the CD-ROM version which would have been at least 240 megabit.
Phantasy Star IV: The Return of Alis
Also known as: Phantasy Star 4: The Return of Alis
Phantasy Star IV: The Return of Alis
Published by: SEGA
Developed by: Sonic Team
Release Date: Cancelled
The planned fourth game in the Phantasy Star universe never released in this form.
The planned fourth game in the Phantasy Star universe (not necessarily the same as Phantasy Star IV: The End of the Millennium -- the game went through numerous changes in production), this title was originally planned for Sega Genesis and the new Sega CD, and was rumored to follow the story immediately after Phantasy Star III and the further terrors of the Dark Force. The game was designed to feature audio and video on the CD, with a game world 20 times that of previous entries, and ambitious upgrades in the 3D dungeon technology. It was unfortunately never released in this particular form, either on Genesis or Sega CD.
Exclusively on Sega CD
Release Date: Unreleased