Atmosphere makes Stronghold 3 unlike any game prior, and adds a much more sophsiticated layer to the game. In Stronghold 3, atmosphere makes all the difference to a map, from being dark to light, and stormy to sunny.
Below is an example of how the atmosphere can change in Stronghold 3, and what the effects can be.
As you will gather, atmosphere means a lot. It sets the mood for the map, the tension and keeps the player interested. It also gives a massive effect to the player bringing the map alive. Therefore, it is vital you ensure your map includes atmosphere. The best type of map includes atmospheres that are scripted to change over periods of time.
This panel simply allows you to set the default theme and mood of the map. As soon as you select an item from the menu, the atmosphere will change. As an example, I selected "night" and "story" to get the following combination:
I recommend changing the atmosphere last on a map. This is generally because it can make things harder to see if you choose a night, for example - so you might miss out important things or details which are wrong.