Games like System Malfunction
Games like System Malfunction include Firewatch, SOMA, Layers of Fear (2016), What Remains of Edith Finch, and Mouthwashing. We matched them by the tags players give System Malfunction on Steam (Horror, Psychological Horror, Walking Simulator, Immersive Sim, and Atmospheric): closest matches first, and among equally close ones the better-known games.

Firewatch
Shared: Walking Simulator · Atmospheric · Adventure

SOMA
Shared: Horror · Psychological Horror · Atmospheric

Layers of Fear (2016)
Shared: Horror · Psychological Horror · Walking Simulator

What Remains of Edith Finch
Shared: Walking Simulator · Atmospheric · Story Rich

Mouthwashing
Shared: Horror · Psychological Horror · Atmospheric

MiSide
Shared: Psychological Horror · Horror · Story Rich

SILENT HILL 2
Shared: Horror · Psychological Horror · Atmospheric

Still Wakes the Deep
Shared: Horror · Psychological Horror · Walking Simulator

Amnesia: A Machine For Pigs
Shared: Horror · Walking Simulator · Psychological Horror

No, I'm not a Human
Shared: Horror · Psychological Horror · Atmospheric

The Cabin Factory
Shared: Horror · Psychological Horror · Walking Simulator

Outlast
Shared: Horror · Psychological Horror · Atmospheric

Little Nightmares II
Shared: Horror · Adventure · Psychological Horror

Little Nightmares
Shared: Horror · Atmospheric · Adventure

Fears to Fathom - Ironbark Lookout
Shared: Horror · Psychological Horror · Atmospheric

Visage
Shared: Horror · Psychological Horror · Atmospheric

OMORI
Shared: Psychological Horror · Story Rich · Horror

POOLS
Shared: Psychological Horror · Walking Simulator · Atmospheric

Sally Face - Episode One
Shared: Psychological Horror · Horror · Story Rich

The Exit 8
Shared: Horror · Walking Simulator · Psychological Horror

Welcome to Kowloon
Shared: Horror · Psychological Horror · Atmospheric

The Beast Inside
Shared: Horror · Adventure · Psychological Horror

Fran Bow
Shared: Psychological Horror · Horror · Story Rich

The Complex: Expedition
Shared: Horror · Psychological Horror · Story Rich