From StrategyWiki, the free strategy guide and walkthrough wiki

Sega Technical Institute
Founded	1990
Founder(s)	Mark Cerny
Located	USA
Closed	1996
Wikipedia has more about this subject: Sega Technical Institute

The Sega Technical Institute was a video game development division of Sega based in the United States, unlike the AM divisions which were based in Japan.

STI was at one time an elite organization within Sega of America that developed well-received games such as Kid Chameleon, Comix Zone, The Ooze and Die Hard Arcade (this one being the result of a team-up between STI and successful arcade game developers AM1).

Although the original Sonic the Hedgehog was developed in Japan by Sonic Team, the Sega Technical Institute held the principal responsibility for Sonic the Hedgehog 2, assisted by members of Japanese development teams including several members of Sonic Team such as Yuji Naka and Hirokazu Yasuhara. However, only the Japanese members of STI developed Sonic the Hedgehog 3 and Sonic & Knuckles along with Sonic Team, and the American developers worked on Sonic Spinball instead.

STI disbanded after the cancellation of Sonic X-treme. Some of the key members currently work for Luxoflux and Microsoft.