Ultima Online: Third Dawn, released in 2001, introduced 3D models to the Ultima Online MMORPG franchise. While the game still maintained its scaled, overhead view, the character animation was much smoother. With the introduction of the Kingdom Reborn client (a more sophisticated 3D Ultima Online client), the Third Dawn client is obsolete, and no longer usable on official shards.
Even the original Ultima Online client uses a height map for terrain and three dimensions for item and character location within the world, but the newer "3D Client" introduced with Third Dawn included 3D models for all creatures. It still, however, maintains use of 2D artwork for objects. While it has an option to zoom in, it does not allow for any rotation due to the 2D artwork still incorporated, and the way the map is constructed. Some of the 2D artwork (especially walls and trees) were improved noticeably.
Source: Wikipedia, "Ultima Online: Third Dawn", available under the CC-BY-SA License.