Time elapses faster in the game than it does in real life. We call this measure "game time." In the table below, we give an equivalent from game time to real time. Day and night are split roughly equally.
Game Time Real Time 1 minute 3 seconds 20 minutes 1 minute 1 hour 3 minutes 6 hours 18 minutes 24 hours 1 hour 12 minutes. Night time is usually much darker than day time, and it is best to bring a light source (such as a torch) to better see at night. They are especially useful in dungeons, which have some light sources but are otherwise very, very dark. Torches last approximately 10 minutes of real time (about a little over three hours in game time). They can easily be purchased in the cities. Some monsters also drop them in dungeons.
When you start the game for the first time, it's entirely possible that you will find it a bit dark. Open your backpack. Most T4C servers will provide you with a bit of starting equipment, including a torch or two. Just double-click on that torch with your left mouse button and the screen will brighten up for a while. You can also type F4 to quickly light a torch without opening your backpack. Also, when you open up a menu (Options menu, Backpack, Skills, Spellbook, etc.), the screen will light up temporarily so you can see the menu clearly. When you close those menus, brightness returns to normal.
Some NPCs do or say different things depending on the time of day. Make sure to visit them at both times if you are on a specific quest that may involve them.
There are a great number of dungeons and caverns in the World of Althea. Both are usually located underground and are infested with monsters and various nefarious creatures. The main difference lies in the amount of light you have. Dungeons often contain torches to light part of the way, allowing for a generally higher level of lighting than caverns. The latter, being in uncivilized areas, are much darker. It would be unwise to go adventuring in a cavern without any source of light.