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About halfway through the season, it was evident that the show was in danger of being cancelled. The rest of the episodes were put on hold, while the creators wrote and filmed the final episode (which was written in a way as to serve as both a series finale, if the show was cancelled, and a season finale, if the show would've gotten picked up for a second season). Several episodes later, it was cancelled.
Series producer Judd Apatow told Vanity Fair in 2012 that whenever he sees an opportunity to use anyone from the show, he does. It is his way of refusing to accept that the show was cancelled, and that all of his subsequent movies are the continuous adventures of those characters.
The creators were determined not to end each show with a typical "happy ending". One notable exception is the pilot episode, which the creators purposely wrote as a self-contained story, in case the show was never picked up for production.
The actors improvised lines in many of the scenes to achieve a sense of reality.