This was posted on the homesite of tf2 today,didn't saw a topic about it & i thought it was an interesting thing to talk about.
The path to arriving at a final design for a character is
sometimes a long and winding one. This was especially the case for the
Demoman and we thought it would be interesting to step through that
process and shed a little light on how we arrive at our final designs.
Early on in the process, soon after we decided that we were going to
start a new, more stylized direction for TF2 it opened up a whole range
of possibilities in terms of what that meant visually. One of the first
(albeit short-lived) ideas that was being thrown around was to try to
recreate a look of claymation for our game. The idea was to make the
world look like a miniature set built for clay figures which animated
and gibbed into chunks of clay.

A quick set of concepts were made to test the idea but we quickly
realized that though the novelty of such a direction would be
interesting, it didn't fit some of our higher level goals in terms of
what kind of product we were trying to deliver. However, we did want to
hold onto this concept of simulating real world artistic materials in
the game and this led to the more painterly look which eventually
shipped with the product.
Now that we were back to the drawing board an effort was made to first
think of these classes as full characters with a history, distinct
personalities and even nationalities. Short biographies were draft
which helped the artists concept characters which they imagined would
match these biographies. For the Demoman, although the angry Scotsman
was already an archetype common in media we decided to embrace that.
The short bio was:
"A fierce temper, a fascination with all
things explosive, and a terrible plan to kill the Loch Ness Monster
cost the six-year-old Demoman his original set of adoptive parents.
Later, back at the Crypt Grammar School for Orphans near Ullapool in
the Scottish Highlands, the boy's bomb-making skills improved
dramatically. His disposition and total number of intact eyeballs,
however, did not."
With this bio to springboard from and constant meetings between the
artists and feedback from the team, a number of concepts were created:


As we were designing the characters, a stronger emphasis was
simultaneously being placed on readability of the classes when playing
the game, and so as you can see in the examples above, the silhouette
of the Demoman was becoming more and more distinct. The first few
concepts didn't really separate him out from the rest of the classes
but as he was refined the more substantial upper body shape helped make
him recognizable immediately.
At this point, the 3D model for the Demoman was being built and we were
preparing to move on. However, there were still some who didn't think
he was quite there. A nagging feeling that perhaps the embracing of the
archetype was a little to generic. Perhaps a little too much like a
groundskeeper in Springfield. We needed a twist to make him more
interesting. We didn't want to lose his personality but felt like
visually he needed something that broke the cliche. A suggestion was
made to have him of African descent and we ran with it.

With a few modifications to his overall shape we soon arrived at the
final concept and what you all see and play in the game today:

So how did they go from a white,ginger with dynamite & grenades to a 'black scottish cyclops' with stickies & pipebombs