The Shadows
Shadows can play as much of a role as the lights themselves do.
Light and shadow can be thought of as the Yin and Yang of lighting in general...they rely on each other, and a scene with lights but no shadows looks as wrong as shadows with no lights. As the Zen masters used to say: "What is the sound of one hand lighting?"
They didn't really say that…but they might have if they were Zen Lighters.
The biggest challenge we face currently due to tech limitations (in most game engines) are:
1) Dynamic lights cast hard-edged shadows.
2) Dynamic shadows are expensive.
If you want soft shadowed areas with no hard lines, you usually have to resort to light mapping, or if you're working on a project/engine that doesn't use light mapping, softer shadows can be faked with a few different methods.
This is one of the benefits of lightmapping…your shadows can be as soft as you want, and you can use all the lights you need without worrying about performance.
If you're lighting a game with only real-time lighting, some of the tricks you may have to employ to simulate soft shadows include:
1) Using volumes to occlude the light in the area. If these volumes can be set to have a smooth falloff, it can look like soft shadowing. (More on volumes later.)
2) Adding light to surrounding areas, but preventing it from hitting areas you want to remain darker, through the use of light falloff.
3) Using "negative lights" and pulling the light out of a given area. (Some engines support negative lights.)
4) Using gobos to help darken an area.
