How do you attack in this game? They explained it in the beginning, but I accidentally clicked the little window away and now I can't recall it. Can ready my weapon, but don't know how to swing it. Any help would be greatly appreciated.

It's very easy, actually.

Use the F-key to ready and put away your weapon.
To attack you simply press the left mouse button to attack. Hold the button down for a slower more powerful strike (much like in Ultima Underworld).

That is for a standard attack (a chop). To make a sideways swipe attack as you move sideways, or you can make a piercing lounge if you move forward just as you attack.

Or, in the setting you can select "Use best attack", whick will always use the best kind of attack depending on the weapon you wield by simply clicking once (or hold-and-release).

Have fun...

It only does that when you're facing something living, I assume, as when I acquired the dagger in the beginning of the game and tried that out, it didn't do anything...

No, the visual attack will occur whether there's something in front of you to slice and dice, or not. You just click F to ready/unready a weapon, then press your left mouse button to do the attack. The LMB is an activator, so if you press R to bring up your hands to cast a spell, hit the LMB and the spell will be cast.

Oops, seems like I reconfigured my keys so Return was attack instead of left mousebutton :whistle:

Heh. Happens. :)

And if you want to add a whole new depth to morrowind try out the Combat Advanced mod. I myself don't use it since I use the "use best attack" option, but if you don't it adds a whole new level to combat moves and death animations, and also bullettime (or something like it)

Oh, and also download a housing mod like Morrowind Abodes, so you will have your own little home with lots of storage space for all the artifacts you will find on your journey. :)

Hell, if we're going to get into MW mods, we can talk for hours. I'm running 200+ on my PC, and there are more than 4000 available, currently. :D They run the gamut: bug fixes, utilities, tweaks, ease-of-operation add-ons, quests, races, items, merchants, dungeons, etc. There's even a mod that lets you breed horses (with four attributes) and hire trainers to develop mounts, and another mod that let's you control all aspects of running a mining company.

I suggest checking out Morrowind Summit (which has a database that's searchable by mod category) and TESmods (which provides a lot of detail) for mods.

I wouldn't suggest going to Morrowind Summit. Sure there are a lot of mods there, but the quality isn't guaranteed. I suggest going to mod threads on the forum or you could visit Telesphoros' list of mods it contains most quality mods.