I plan on making a much more detailed post about this later but for the meantime here is a quick summary:
All three stats (Strength, Dexterity, Intelligence) contribute to your character's base damage (to varying degrees).
Strength affects how many hit points you have and how quickly you regenerate them when damaged. Strength also influences your character's base armor rating.
Dexterity affects your chance to hit and your critical hit chance. Dexterity also influences your character's chance to dodge incoming attacks.
Intelligence governs the size of your mana pool and your mana pool regeneration rate. Intelligence also plays a small role in your ability to hit and crit
Each stat is required by certain types of gear. Two handed swords and plate mail armor require Strength. Magic staves and cloth armor require Intelligence. Crossbows and leather require dexterity.
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