Key features of the new D&D include:
This is a major rewrite of the entire system compared to Advanced Dungeons & Dragons, Second Edition.
Going back to thier roots and trying to streamline and improve the system they have made adjustments to all aspects of the system. From adding in popular house rules, combining similar rule sets into one mechanic, and abolishing artifical limitations placed on races and classes they have produced a much better game that it's predecessor .
The d20 system which it is based on is distributed under the Open Gaming License, meaning companies can publish and sell their own products for D&D. This resuled in a massive expansion of the product line and a massive user base expansion.
Also, what must be noted is the design of the new handbooks are quite breathtaking, and are in themselves, works of art. IMHO, the most spectacular is the Forgotton Realms book.
The books are also being mass-produced, meaning that the books are significantly cheaper.
Characters
Combat
Spells
Monsters
Miscellaneous
Changes courtesy of the rec.games.frp.dnd faq.
Something that was discussed relatively often around the release of third edition was the phenomenon of "third edition blandness" - and after switching from second to third in my campaign setting, I noticed it too. In second edition, there was a strong emphasis on class identities. That is, paladins should act like paladins, rangers should act like rangers, and part of the DM's job was to play watchdog to make sure this was followed.
If you peruse the third edition literature, especially the additional class books, the idea seemed to be more to supply the hit tables, feats, etc. instead of the ambience of the class itself. The difference is less defined in the PHB, but it's still there.
But this isn't all bad. Because of the concepts of the classes were more defined in second edition, it didn't give quite as much personal freedom to the players. In third edition, it's significantly easier to make that gladiator class fit your character's history, instead of trying to work around the narrow scope of the class.
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