1. http://planetelderscrolls.gamespy.com/View.php?view=Mods.Detail&id=2735 - This mods recreates and replaces the original faces in Morrowind's character creation (except the Khajiit race) along with all the various NPCs found across Vvardenfell, it may be old but it looks great and I wouldn't play without it.
2. http://planetelderscrolls.gamespy.com/View.php?view=Mods.Detail&id=213 - This mod goes perfectly with the previously mentioned Better Heads (does not affect Argonians and Khajiit bodies) and makes bodies look much more realistic. This mods comes in 3 versions and after you pick your version it basically installs itself. Again, I wouldn't play without it.
3. http://planetelderscrolls.gamespy.com/View.php?view=Mods.Detail&id=3979 - This mod replaces the original blood in Morrowind. At first, blood in Morrowind was just a cloud of red smoke but this mod replaces the original blood file and when an enemy is hit or killed actual blood drops poor out rather than red smoke. Ignore the screenshots posted, when in-game it isn't that crazy and looks pretty realistic.
4. http://planetelderscrolls.gamespy.com/View.php?view=Mods.Detail&id=2487 - This mod is only for you if you have the Tribunal expansion which adds the Dark Brotherhood to the game. Originally almost any time you slept an assassin would attack you which isn't too bad but when you try and heal another comes and it makes early gameplay almost impossible. This mods prevents assassins from attacking until you meet a certain requirement which is usually obtained at a slightly higher level where fighting these assassins is manageable. I wouldn't play without it.
5. http://planetelderscrolls.gamespy.com/View.php?view=Mods.Detail&id=9177 - I was recently introduced to this mod from another member on these forums and it's amazing, it adds a sense of life and realism to the game that the previous eyes didn't. It recreates alot of the eyes making them look a lot better too. I've only had it for a couple of days but it is amazing and again I wouldn't play without it.
6. http://planetelderscrolls.gamespy.com/View.php?view=Mods.Detail&id=9434 - This is another face mod for the female characters in Morrowind. It adds new faces for female Dunmers, Bretons, Nords, and Altmers. I don't think I'd play female characters without this mod or its add-ons.
7. http://planetelderscrolls.gamespy.com/View.php?view=Mods.Detail&id=9442 - This mod does what the mod above does but is now available for the Imperial race.
8. http://planetelderscrolls.gamespy.com/View.php?view=Mods.Detail&id=9455 - This mod does the same thing as the previous two but now for Redguards.
9. http://planetelderscrolls.gamespy.com/View.php?view=Mods.Detail&id=9449 - Same as the three previous mods but now for Wood Elves as well.
10. http://planetelderscrolls.gamespy.com/View.php?view=Mods.Detail&id=9444 - This mods adds a few new hairstyles for female races. They look realistic and also come in different colors for each hairstyle
That's all I got for now, please share some of your favorite mods to enhance gameplay experience for everyone!!