Might and Magic III: Isles of Terra is the third game in the role-playing video game series Might and Magic. Released in 1991, it is the predecessor to Might and Magic IV: Clouds of Xeen and the sequel to Might and Magic II: Gates to Another World. A Sega Genesis version was developed, but never released.

Might and Magic III employs an updated first person perspective interface based on the one employed by Might and Magic Book One: The Secret of the Inner Sanctum and Might and Magic II: Gates to Another World. The action is turn based throughout the game phases. A number of improvements, made possible by an expanded development team and advancements in computer technology, are incorporated. The graphics are more colourful, taking advantage of contemporary VGA displays. A number of sound cards are supported, offering improved sound effects, background music, and synthesized speech. Mouse interaction is also supported for the first time.

Textual character summaries in the lower portion of the screen are replaced with a graphical head-up display, featuring the faces of the player characters, which wear different expressions depending on the condition of the character. Spells are selected from a list: an improvement on previous games where they had to be specified using numeric codes. Level maps were no longer limited to a 16 x 16 grid, and an automapping function eliminated the need for drawing maps on paper. Also, enemy creatures can now be seen as they approach, or are approached, from distant squares. In previous games the enemy creatures were only detected when they were in the same square as the player characters, which made combat more difficult to avoid. The ability to shoot at a distance also gives ranged weapons a more distinct tactical advantage. At the end of combat, players do not have to "search" for loot as in previous games.

The player can save the game state at almost any time, with the notable exceptions of the Arena and Castle Greywind Dungeon, at which the player cannot store game state. In previous games, saving was accomplished by visiting an inn and signing the registry. Saving the game also records that enemy creatures have been killed; in previous games traveling to a level from an inn fully populates the former with monsters every time.