10.  Optional:  Disable Use Mist button
  • Properties menu >> Material button >> Options tab
  • Use Mist checkbox
  • Use Mist works on the material on an object. 
  • If you have more than one material on your object, Use Mist will have to disabled on each of the materials
11.  Start Game Engine
  • Info menu >> Game >> Start Game Engine
Download Finished blend: