Blender

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Blender is a free open source 3D design tool. It has been used to create content for movies and games and is easily the most powerful free 3D software available, closely rivaling commercial competitors.

There is a massive online community and hundreds of hours of tutorials available via YouTube and other sites. Google is your friend.

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Blender YouTube Tutorials by Andrew Price

I use blender for creating content for virtual worlds as well as my own game projects. It has very strong modeling, UV mapping, texture painting, texture baking and animation systems making it a great all in one package for game content development.