Catlantean 3D is a retro first-person shooter being developed from scratch using 1990s constraints including 320x240 resolution, 256-color palette, and hand-coded rendering. The developer discusses creating assets within these limitations, including palette design, colormap shading techniques, and various sprite creation methods ranging from pre-rendered 3D models to hand-drawn pixel art, all while maintaining the crisp aesthetic of classic games like Doom.