Language packs are small files which can be downloaded and will translate some or most of REAPER into another language. They are typically files named "<language name>.ReaperLangPack", and if you open them on the computer (either by doubleclicking or drag and dropping into REAPER) they will be installed into REAPER's LangPack folder, and REAPER will switch to use that language. Note that to use language packs, you need REAPER 4.20+. Switching languages requires restarting REAPER.
Most people will just want to use language packs. If you are interested in making your own custom language packs, however, you can read on.
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If you wish to translate REAPER to another language, you can download the template language pack and get started editing the relevant lines. Some notes:
The first line is special and has #NAME: followed by the display-name for the language.
Lines beginning with ; (which in the template is nearly all of them) are effectively commented out. It is recommended you leave unmodified lines commented, and uncomment lines only after you have translated them.
The format of each non-section-specifying line is HASHCHARACTERS=string value. Note that the string value can have \r, \n, and \t in it, and in some cases even \0 (depending on the context).
Lines in the template beginning with ;^ are lines which also exist in the [common] section (see below).
The [common] section has many strings which exist in multiple sections. Usually you will be fine to just translate the common version, and not bother with those lines in individual sections.
For best results, you should save your template text file as UTF-8, or UTF-16, but be sure that it has a BOM if in UTF-16. If no BOM is found, UTF-8 is assumed.
Many dialog controls will automatically size up to fit longer content, although currently it is still constrained by the total space available.
There is a tool for merging edited language packs with a newer version of the language pack template. Using this tool, you can for example see what new items were added in a new version of the template, or if items were removed, you can see which of your translated lines might be stale. This tool is available here (there are Windows and OSX builds, and source available). Be sure to back up your work when using this tool!