WME supports two types of fonts to display all the in-game texts: bitmap fonts and TrueType fonts. Bitmap fonts are created by a single image containing all the letters, while TrueType fonts are the typical vector-based fonts used anywhere else in Windows.
Both types of fonts have their advantages and disadvantages. Since bitmap fonts are based on an image, you have better control over the letters appearance and you can use various color gradients and other graphics effects. You can even make animated bitmap fonts. On the other hand, bitmap fonts are limited to 256 characters and therefore you can't use them to display texts in Asian and other "double-byted" languages. Also creating bitmap fonts is more difficult.
TrueType fonts are limited to simple non-animated colored texts, but because WME uses the standard Windows text rendering functions, you can use them to display wide variety of world languages, including Asian languages. Also, enabling TrueType font to be used in WME is a matter of writing a simple text definition file, making it a much easier process than generating bitmap fonts.
The following chapters discuss both types of fonts in greater detail:
One important thing to note it that from WME's point of view the two font types are interchangeable. They both use the .font extension. The interchangeability means you can, for example, create an English version of your game using bitmap fonts, and when you later decide to create a Japanese version of the game, the Japanese language package will contain a different font with the same name, but defining a TrueType font instead.