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If you read my review to Heroes of Might & Magic (HoMM) 2 Gold, I can make it short: This is basically the same game but even better, while it has more difficult campaigns.
The story plays when Catherine Ironfist becomes queen of Erathia and has to fight against the "devils" (or rather Kreegans) to restore peace in Erathia.
Well, the gameplay, as said before, is quite the same. Again, one commands heroes that run around with creatures to collect resources, explore the map, fight other creatures, fight other heroes, conquer towns, sometimes defend own town, etc. - much like in HoMM 2. If I remember it correctly, here level limits for heroes were introduced and heroes could be taken across campaign levels. Actually, it was my bad skill in this why I stopped playing HoMM 3 after a while. There's a mission where one has several heroes (four or eight) in the second campaign, and that became too much for me at that time since I was used to do everything with a single hero.
Well, the improvements over HoMM 2:
There are nine town types now (eight without addons), with even more buildings per town. There are more objects to find on the maps, in render graphics. The ambient sounds are also better. There are more spells, more creatures, more artifacts, more victory conditions, etc. - there are also more maps and campaigns!
So the game becomes more complex but not so complicated that one really needs to read the manual.
To me, this is still the best of its genre (turn-based-strategy). HoMM 4 and 5 are also good games, but 5 is annoying to always adjust the view so one sees everything, while 4 concentrated more on different aspects, making also a very good game, only slightly worse to me than HoMM 3.
There might be much more to write about HoMM 3 but I suggest you just to play it or - if you don't want to buy it directly - test the demo version.
Tip: You might also want to install "In The Wake of the Gods", an inofficial freeware addon for HoMM 3 (see the thread in the forum for details).