From Wikipedia:
The Future of the Series
Amy Hennig, who led the Crystal Dynamics team responsible for Soul Reaver 1 & 2 and Defiance, left Crystal Dynamics shortly after Defiance was released. Because of this, Defiance is considered by many to be the last Legacy of Kain game, considering that Hennig is no longer with Crystal Dynamics' Kain team--if they still exist--and that it has been more than four years since information has been released concerning plans to continue the series. Another blow was the death of Tony Jay, a key voice actor throughout the series, who provided the voice of The Elder God. And yet another serious blow was death of Kyle Mannerberg. Kyle was the last man who Amy put in charge of Legacy of Kain series.
However, in 2006, Crystal Dynamics finished development of Tomb Raider: Legend and it is now possible that Crystal Dynamics will make a new game for the series on some or all of the next-generation video game consoles. What some believe to be evidence of this possibility can be found in the game Tomb Raider: Legend in the form of two unlockable extra costumes for Lara Croft: 'Gothic' and 'Gothic, Lace Shirt' variations of Lara's ensemble. In these costumes, Lara bears a neck tattoo of Raziel's clan Glyph, and her belt buckle carries Kain's Glyph. The Soul Reaver sword itself is also an unlockable extra only available upon 100% completion of the game. There are portraits of Kain in her mansion, which can be found in the "Kain's Tomb" section of Defiance.