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I recently discovered that I've somehow started my first play through of Skyrim on Master difficulty which certainly explains a lot of my frustration! However, whilst it has been insanely frustrating at some points I've found it very rewarding when I do get past a tricky enemy by use of tactics and use of the environment.

I was wondering if there would be anything to stop me from continuing on Master but when I reach a point where I'm getting way too frustrated I could just drop the difficulty back a bit? Seems like one of those things that may have implications on my experience in the game world and if so I'm curious to know what that is.

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Nope, as far as i know difficulty is handled in this game like it is in most elder scrolls games and that is to say it doesn't effect anything except... well difficulty. :)

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I think one of the loading screens actually tells you that you can change anytime you want as many times as you want. – GluedHands Dec 3 '11 at 15:59
Indeed you can, and without any consequence. If a fight really is too hard, after 50 tries, don't throw away the game.. try on easiest (or use the console). Then again, I've read some hints on not to do this too fast: the default difficulty level really is playable. And the satisfaction I had after finally killing Krev the Skinner as a werewolf was huge! – Konerak Dec 5 '11 at 22:01
Actually the loading screen that @GluedHands is referencing says that you can even change the difficulty during combat. – yrstruly Dec 6 '11 at 23:56

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