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Here are the initial tools you will need for building your own N2 based track and a brief description of how to use each. Since N3 requires slightly more advanced tools, they can be found in the Intermediate section.
3DO Editor from The Pits

very straight forward, open the 3do you want to work with in here and start going. you can edit vertex positions, where the points are, to alter shapes, etc.

A dat packer/unpacker from The Pits (I use DooDat)

doodat's rather self explanitory

A zip program i.e.: Winzip (I use Enzip: freeware)

everybody knows how to use this, right?

Winmip2 from here (forget Winmip1,)

winmip2 allows you to edit every file for every game and fix the draw ahead. Winmip1 would not allow for editting the sub_im which needs to be 0. remember to set it to 0 in Winmip2. this has been a big problem for some people. Also take note that M16 files are completely different from their mip counterparts and need to be editted seperately.

Cam Editor from BB&B optional (comes with bank edit from BB&B)

I've never actually used one of these.

A good Paint Program I suggest one from the Paint Shop Pro Series

These are numerous and all have their own instructions. Get to know your program well, it will make all the difference in your end product.

LP Editor from The Pits (I use the latest version with the replay to LP editor)

read the directions that come with it carefully

Bank Editor or some other program to edit the .trk file from BB&B or The Pits

simple program, if you're lucky, it'll do the 3do too.
3DO Banker from BB&B

if the bank editor above doesn't do the 3do, you will need one of these. follow the commands to use it. to find the banking factor, take the new banking and divide it by the old banking.

Mass 3DO color changer from BB&B (optional)

look at the pallete and try to figure out which colors are associated to what before you change anything. And always keep a backup of the 3do.