This is the first time i hear about this software and i was wondering what it is used for?

Maybe a better question is, what doesn't it do? 3D animation, modeling, compositing, etc.

Blender is one ot the topmost 3D modeling and animation software in the world. With it you can model and texture clothing and props for the Poser/DAZ Studio figures sold here. In fact I did model my products with it.
You can also model, rig, texture, animate things like the dinosaurs of Jurassic Park.
You can find full information at www.blender org, where you can also download the program. Be sure to check www.bigbuckbunny.org for an example of what can be done with Blender.

Quote - Maybe a better question is, what doesn't it do? 3D animation, modeling, compositing, etc.

Now I am curled up with laughter because I was going to say the same thing. It would be easier to state what it can't do, and that is nothing except put the kettle on LOL. I have never known the program to fail at any level, and I am still finding new things hidden away.

I have to agree with you Benney. I'm glad you got a laugh from my answer. We need more of those these days, laughs that is.

My answer would be that Blender does 3D stuff. Check out the "resources for Blender newbies" thread if you haven't done so already.

you can make games with it, so it's also a sort of development environment.  and in terms of 3d, it has hair dynamics, soft body dynamics, rigid body dynamics, particle systems, wind and force dynamics, fluid dynamics and lately i've been hearing more and more about smoke and fire. even lots of high end 3d studio apps don't seem to do as much without add-ons. it supports NURBS, Bezier and meta objects (like meta balls).  and the sculpting tool is very handy.  i've never tried it, but it can take images for brushes.  you can UV map with it, texture paint with it, and make some pretty incredible renders with the native renderer.  and there's lots of add-ons.  there's a plugin for Blender that does great toon and stylistic rendering.  i've seen one for generating and animating crowds of figures and making them fight on a terrain.

as with any 3d studio app, there's applications out there that do some of those jobs better.  Zbrush is better at sculpting for instance.  but unlike those other applications, Blender is a lot cheaper than those focused apps (as in free), and people keep making more free stuff for it.