Neverwinter Nights was developed to be played similarly to the Gold Box series of games. Players would begin play by creating a character, and outside of character creation, game play took place in a screen that displayed text interactions, the names and current status of one's party of characters, and a window which displayed images of geography, marked with large or small pictures of characters or events. When combat occurred, gameplay switched to a full-screen combat mode, in which player characters and enemies were represented by icons which would move around in the course of battle.
Neverwinter Nights was a co-development of AOL, Stormfront Studios, SSI, and TSR (which was acquired by Wizards of the Coast in 1997).
Neverwinter Nights was the first multiplayer online role-playing game to display graphics.
Don Daglow and the Stormfront game design team began working with AOL on original online games in 1987, in both text-based and graphical formats. At the time AOL was a Commodore 64 only online service, known as Quantum Computer Services, with just a few thousand subscribers, and was called Quantum Link. Online graphics in the late 1980s were severely restricted by the need to support modem data transfer rates as slow as 300 bits per second (bit/s).
In 1989 the Stormfront team started working with SSI on Dungeons & Dragons games using the Gold Box engine that had debuted with Pool of Radiance in 1988. Within months they realized that it was technically feasible to combine the Dungeons & Dragons Gold Box engine with the community-focused gameplay of online titles to create an online role-playing video game with graphics. Although the multiplayer graphical flight combat game Air Warrior (also from Kesmai) had been online since 1987, all prior online RPGs had been based on text.
In a series of meetings in San Francisco and Las Vegas with AOL's Steve Case and Kathi McHugh, TSR's Jim Ward and SSI's Chuck Kroegel, Daglow and programmer Cathryn Mataga convinced the other three partners that the project was indeed possible. Case approved funding for NWN and work began, with the game going live 18 months later in March 1991.
Daglow chose Neverwinter as the game's location because of its magical features (a river of warm water that flowed from a snowy forest into a northern sea), and its location near a wide variety of terrain types. The area also was close enough to the settings of the other Gold Box games to allow subplots to intertwine between the online and the disk-based titles.
Source: Wikipedia, "Neverwinter Nights (MMORPG)", available under the CC-BY-SA License.