Fatigue is a system that activates starting Chapter 10 (The beginning of the Western Isles) that has a very simple function. Each character who's involved in a combat action has their fatigue increased by 1 (So, you have Wolt attack an enemy, this is a single combat action, this triggers 'Second Strike' and a second attack, which doubles, this is a single combat action. On the enemy phase, Wolt is attacked, and cannot counter, this is still a combat action. In the end, Wolt will have 3 points in his Fatigue bar) once a unit reaches 30 Fatigue, they become 'Fatigued' this is checked at the start of a chapter, not during.
All stats (Including HP) Drop by 1/4th
Move drops by 1
Ways to restore Fatigue
Not deploying for a chapter
Using a Stamina Potion
Being a necessary unit upon a map (Example: Shanna and Clarine will have their fatigue wiped to 0 at the start of Chapter 11, as they can interact with Thea and Klein)
It is the Final Chapter(Still being debated)
Roy, Guinivere, Lilina and Larum are immune to Fatigue.
Why go with a stat penalty and not a unit ban?
Let us consider a hypothetical scenario, the deploy limit for two chapters in a row is 15+ Three Lords. The player has 18 units +Lords, at the end of the chapter, all 15 deployed units have become Fatigued, and they have no Stamina potions
This player is now forced to take the next chapter as 3 Lords+3 units. Impossible? No. But very difficult, and depending on the surviving units, perhaps a game ender. The thing Fire Emblem has always had a problem with, in my personal opinion, is the game grows tougher the worse you are, and easier the better you are with not much you can do to stop prevent that from being the case.
Now let's take a look at the same scenario but with the current penalties, we'll say... bringing a hypothetical N unit. N has 30 HP, 18 Str, 10 Skill, 15 Speed, 10 Def, 2 Res, 20 Luck and 5 movements. With the fatigue penalties, N becomes
Worse? Oh god yes. Impossible to use? Hardly. Let use an earlier example for the sake of simplicity, Y has 20 HP and 8's in all his stats Y's HP becomes 15 and his stats all become 6. Not nearly as bad. And that's why I like this system. This system isn't all that punishing to low statted units they still function essentially the same, but at higher levels, the penalties start adding up. Let's take a capped Warrior as an example.
HP 60 -> 40
Str 30 -> 22
Skl 26 -> 19
Spd 24 -> 18
Lck 30 -> 22
Def 28 -> 21
Res 20 -> 15
A bad unit? Hardly, But a shadow of what it could do. But if you're pushing to use a unit to fill a slot, even at end game that fills a slot. It's basically a Fighter who almost capped everything.
So as you can see, a player who's having a rough time, they might be forced to use a Fatigued unit, but they'll at least have the body to use and yeah it'll still be a rough time, but it won't be a massively daunting experience. And since Constitution isn't affected units can still steal, or rescue or canto away, even with reduced 5/6 movement for thieves/mounted units.
Why 1/4th and not 1/3rd
While 1/3rd is essentially a slightly harsher penalty, it finds itself lowering a unit just a little much in the later stat growths. A unit with 30 Str has 20, in fact, excluding HP, no stat can rise above 20. That means any unit suffering from Fatigue is worse than a promoted unit unless literally capped at a stat. 1/4th is just my personal feeling of kindness to the player. Ultimately it could probably be 1/3rd but I believe the extra stat drop would be too much punishment.
But why Fatigue?
Two reasons, which can be understandably disliked.
Reason 1: This game is long, it's 37 main chapters and 7 Gaidens. At 44 Chapters long it is as long as Radiant Dawn (Counting Prt. Chapters as individual chapters) without third tier promotions or constant army switching. I could either severely nerf EXP gain which is a negative option in regards to player retention (Players who feel as if they aren't growing tend to dislike and stagnate on games) or increase the level cap to 30/30... doable except the stat caps don't really accommodate that. And that is a FAR more laborious task than Fatigue was. I could do it, but it'd be a last resort kind of thing, the same as making a "Tier 3" We could have 30/30 with lowered growths to accommodate, but again, this has the issue of leaving the player feeling as if they aren't growing. I'm also a proponent that the pretty green numbers should NOT be required at the end-game for a unit to function. There were options but I had to consider the work involved with them Even "Well cut chapters" isn't really an option as that would lend itself to rewrites more and more.
Fatigue gets around this in a rather simple method. If your squad is 15+3, and you have 30 units, then 15 in one chapter, 15 in the other, a rota of A and B teams that slowly grow together and keep pace with the enemy. Can you forgo this and just deploy the Percybomb relentlessly? Sure, he's not going to be much of a bomb when stat dropped.
Reason 2: I like to discourage "Low-manning" that is the tendency to grab a single 'God' Unit and just charge the enemy into them and watch the enemy melt like so much cheese in a microwave. It's not that there aren't good units, but I like to provide multiple objectives on a map, multiple fronts to fight on and encourage the player to make use of their whole team. That doesn't prevent a player from completing a map by just ramming a single powerful unit into the enemy, but maybe it stops them getting all the villages, or it prevents them from recruiting someone, or they lose chests. One of the reasons I really like Chapter 11A of FE6 is because the entire map comes into play. There are issues with it, but they're so minor in comparison to the knowledge that to best handle the map, you should spread out and form teams to tackle the objectives. Again, nothing stops you from charging Dieck into No Mans Land to end the map before Echidna even spawns but that's a lot of treasure you're not getting. And in the end, Dieck's not going to be so great on the next map, and your other units missed a chance to grow levels. Not every map has to span multiple objectives and have you running to all corners to get everything, but those are my favorite, and I enjoy encouraging the player to try out the various units they have.
Some like to say that this reduces one of the parts of Fire Emblem, namely feeling like you can go through the game and explore different party configs, but that's the beauty of FE6, even if every map is 15+3 and forcing you to deploy 30 units to never get caught off by Fatigue... There's still 30 more units in the game, each with minimum 5 supports, unique skills, and base conversations for you to get to know them and want to try them out. Maybe you want to build "Team Aura" and thus you use every character that buffs other characters to move as a death ball, grand, you can find all new, wacky ways for units to get more use. Sure, the Professional Motherfuckers don't get their skill bonus without the other by their side, but skills like that are far and few between. then when you consider the Skill Badge system (Hold items that bestow a skill upon a unit) and the various weapons, the Anna Shops, the Arena (Which you can't die in, to be clear. Limited fights, each fight costs cash, but you cannot die) there's way more content to explore and consider. And I guess this is a way for me to push players and go "That unit that you considered trash before? Give em a swing."
I plan for Fatigue to be an option when you start the game on normal mode (Forced on hard) but I would ask people to give it a try and see for themselves how it feels. I consider the games curve balanced around having it on, however.