The first expansion pack for Morrowind was developed by Bethesda Softworks and published by their parent company ZeniMax in November of 2002. It is the first of two expansion packs for the game, the second being Bloodmoon.
The original Morrowind is simply a very large, open-ended gameworld that the player can roam freely in. There are a great variety of items availble in the game, as befits an RPG of this type. This expansion adds some additional areas the player can tromp through and bash monsters in, as well as a whole bunch of new weapons, armor, and other useful things. It also adds an extremely useful new feature to the journal system: the ability to organize journal entries by the title of the quest to which they apply. Installing the expansion and loading an old save game will automatically organize all of the existing journal entries in that save game under their appropriate headings. It can be argued that this isn't so much a new feature as fixing something that was broken; the journal was somewhat unwieldy before, but is now quite useful.
Aside from the new journal feature, this expansion is just a massive infusion of content. There are no new spell effects or races, or anything of that sort, just new places for the character to run around, new items to seek out, and new quests to complete. The amount of new content isn't anywhere near the size of the original game; however, the original Morrowind was so very large that even this much-smaller set of dungeons and quests is still almost as large as a whole game in and of itself.
The new areas come in the form of a new city and the vast dungeons underneath the city. Morrowind takes place on an island called Vvardenfell; the expansion adds the city of Mournhold, which is on the mainland. As the developers didn't want to create the whole of the mainland, they walled in the city: you can't leave it; you can't even see outside of it. Travel to and from the city is done via teleportation from a spot on Vvardenfell (specifically, in the fort of Ebonhart).
The city of Mournhold itself is pretty large. I'd place it as the second-largest in the game, after the massive construction that is Vivec. It also has its own resident diety, the goddess Almalexia, much as Vivec has Vivec. Unlike Vivec, however, you can only meet Almalexia through a quest; you cannot break into her chambers. (I always found that amusing about the original game; "Hi, Vivec!") There are shops of all sorts, and some pretty good equipment for sale. There are quests abound, with the various awards available for each. However, the real point of all this is the new dungeon.
Underneath Mournhold is the sewer, which leads into deeper and deeper dungeons. Some of the monsters in these dungeons are quite powerful; low-level characters need not apply. Having access the Intervention spells (to return to town quickly) and the mark and recall pair of spells (to get back to the dungeon quickly) is very useful; you never know when you'll run out of healing potions or arrows or the like. I have yet to explore the entirety of this dungeon, but what I have looked through was very large.
And that's it, really. A massive, massive dungeon, and a city to host it. The new items are nice, too, and the journal system is invaluable (if a little late in coming). There are no new spell effects, but then the magic system is so flexible anyway that you'd probably never notice. All in all, a wholly worthwhile addition.