Working title only, here's I go. I know it's not uber-specific yet, but I couldn't resist getting something up.

1.) What is your game about?
At its heart, this game is about war. War between two factions that seem completely opposite.

2.) What do the characters do?
The characters try to make their way in this world, as more and more creatures from both sides wreck havoc. Whether they do this by sneaking around and hoping to stay unnoticed, picking a side and trying to bring the war to an end, or running down the middle and fighting everyone is up to them.

3.) What do the players (including the GM if there is one) do?
Each player plays one character, and the GM keeps the story moving and provides the setting.

4.) How does your setting (or lack thereof) reinforce what your game is about?
The setting is all about the opposites. The Daylight Realm and Midnight Realm are total opposites, and each spills over trying to take the battleground that is the physical world.

5.) How does the Character Creation of your game reinforce what your game is about?
In addition to their other stats, each character has a balance stat, that will fluctuate during gameplay. Being tipped one way aligns your power to that plane, which is helpful against some enemies but problematic against others.

6.) What types of behaviors/styles of play does your game reward (and punish if necessary)?
The game will reward combat and defeating enemies, but also avoiding dangerous situations. Story rewards and such are around too. Things that align a character to a plane could be seen as a reward or a punishment.

7.) How are behaviors and styles of play rewarded or punished in your game?
Characters will get plot points, which give them some ability to influence the plot, as well as XP to level skills and stats up. Certain actions might be rewarded/punished with a chance in Day/Night balance.

8.) How are the responsibilities of narration and credibility divided in your game?
Everyone does some narration. While the primary weight falls on the GM’s shoulders, players will narrate their clashes as they go. Alternately, the GM could narrate everything.

9.) What does your game do to command the players' attention, engagement, and participation? (i.e. What does the game do to make them care?)

10.) What are the resolution mechanics of your game like?
Resolution will be quick n’ dirty. It’s kind of a halfway point between conflict resolution and task resolution. Each roll is a ‘clash’. So you and the orc rush each other and clash you take him out and sweep on by. Basically, players should cleave through weak enemies easily, but bigger enemies might take many clashes to defeat, each one weakening it.
11.) How do the resolution mechanics reinforce what your game is about?
Resolving in clashes makes things move quickly, which is important in a war and combat-heavy game. It reinforces the cinematic idea in my head too: the hero cutting through the minions before getting into an extended, deadly fight with the big baddies.

12.) Do characters in your game advance? If so, how?
Characters accumulate plot points, with which they can influence most conflicts in the game. They also gain experience to get higher-level skills and abilities.

13.) How does the character advancement (or lack thereof) reinforce what your game is about?
Character advancement represents their increasing importance in the war between the planes. Heroes are the ones who will ultimately tip the balance one way or another.

14.) What sort of product or effect do you want your game to produce in or for the players?
I want there to be fun action, and some thinking about which side is really right. I think a lot of players will be drawn to Light, but that doesn’t necessarily equate to good.

15.) What areas of your game receive extra attention and color? Why?
The different planes are going to receive a lot of attention, as are the creatures that come from them and a character’s day/night abilities.

16.) Which part of your game are you most excited about or interested in? Why?
I’m most interested in watching players try to choose between light and dark, when each has something to offer them.

17.) Where does your game take the players that other games can’t, don’t, or won’t?
More so than most, this game is about alignment. Instead of just a few words written on a character sheet, which way your character aligns actually makes a difference with regard to abilities and powers that the character has.

18.) What are your publishing goals for your game?
I’ll make a pdf if I get it finished and put it online.
19.) Who is your target audience?
RPGers looking for a new bit of stuff to play with.

It looks like an interesting game to play. However, I'm curious if day = "good" and night = "bad." You could really have something going here if you come up with two societies with completely legitimate, yet opposite, points of view--with neither being "right" or "wrong."

No, and this is one of the main tennets of the game. Daylight is not necessarily the "good guys", nor are the servents of Nightfall the "bad guys". Part of the idea is that while the two are opposite, they aren't opposite in the sense of good and evil. Something you could explore for a campaign would be the idea that neither side is right, and there fore what point is ther in the war, and all the destruction caused because of it. Day and Night are at war essentially out of habit now, rather than out of some difference in philosophy or ideals.

So yes, there will be two societies with opposite yet legitimate viewpoints.

What kind of world does this take place in?  D&D fantasy?  Modern day USA?  Is the whole world wrapped up in this conflict?

What do the creatures of light and darkness look like?

What sort of powers do they have?

Sorry it's been a long time before responding, here's stuff.

I initially assumed this would be taking place in a D&D fantasy style world, although I could see a very interesting (and very different) game set in a more modern day, with special forces going at it with these crazy things and simultaneously trying to keep them hidden. I've been coming up with stuff based on a fantasy world, and yes, the whole world is wrapped up in this. The conflict is everywhere.

The creatures of light live in a very airy realm, and as such, may of them are winged creatures. While their appearances vary greatly, all of them will seem shone upon, even in the dark, almost a glow. Creatures of light reflect light wrongly, in that light shining on them seems amplified, not diminished.

Creatures of darkness live in a more cave-like place, and are therefore more creepy-crawly. They move low to the ground and quickly, and most are highly adept at climbing and leaping. While in many respects the creatures of light look angelic and the creatures of darkness seem demonic, they are not really split into  good and evil that way.

Hi!
  Question:
  How do the mechanics/system support the players actually be3ing able to change the game world? I think that is a weakness of games set in this sort of epic scale. That they talk about players making a difference, but there is no oomph to make it actually happen. So, then its up to the GM to sort of adjudicate it and then the game falls flat, sometimes the campaign moves to fast and the world is dominated by the players and sometimes it moves too slow and the PCs enver actually end up changing anything.
  How do you intend to address this?

  It sounds like a really neat idea and I have done some brainstorming about an game similar to this, so feel free to ask if you have any questions/concerns...

You should check out Manicheanism for a great four-color, action-figures theology. It's all about light and dark, creation and destruction, and, eventually, the interwoven, light-and-dark-together nature of human existence.
As a whole, Manicheanism is super-dualistic and kind of nonsensical in determining what is good and bad (taking any life, ever, is seen as evil. Good luck finding food!), but that seems to be in line with what Night & Day is all about: the Daylight and Midnight Realms aren't really good, or evil; they just think they're right and the other is wrong.
Who are the PCs, exactly? Why are these two sides fighting? Is there some benefit they gain from it (or hope to gain from it)? What do their realms look like? Do they have cities? Art? Technology? Culture?
I'm picturing a sort of high-tech/low-brow mix here, sort of post-apocalyptic/He-Man style. Actually, scratch that: I'm picturing He-Man.
If the Daylighters are angelic-looking, but you're concerned about them being seen as Good, then ramp up the angels-as-scary angle that we get in the Old Testament, where angels are always saying "Be not afraid" because they have to. The expectation is that they're about to scorch you off the face of the Earth for your sins, and they have to make it clear that no, no, they're just the messenger.
The Midnighters could always be bestial in appearance, which taps into a certain fear/repulsion impulse (c'mon, babies inherently judge ugly people to be dangerous!), but there's also the possibility that super-humans (the Daylighters) could also seem decadent, removed, or arrogant, while the salt-of-the-Earth Midnighters are sort of noble savages.
I imagine that gameplay would be divided up into On and Off the Battlefield, as a perpetual war between closely-matched powers would mean that anybody who doesn't want to live in a perpetual warzone would have to take shelter away from the front lines.
What are the possibilities of wartime diplomacy? On the civilian end of things, who benefits from endless warfare? Who loses out? What manner of beings ARE they, anyway? What are the possibilities of both Daylighters and Midnighters in the same group of PCs?
An angel and a demon in love is so cliched (worthy of something you'd see on the side of a motorcycle!) as to cause me physical pain, but since they're not explicitly good-and-evil, things can be more interesting than that.

Don't do the love angle, though, unless you're prepared to make both sides fully-realized, three-dimensional societies. Or, alternately, make them chromatic opposites, so basely different from one another as to lack any real meaning beyond the superficial. "Look Who's Coming to Dinner", anyone?

@dindenver: well, I'm still giving that some thought. I think the players need to be able to do something that will shift the balance of power in at least the immediate vicinity, and have some way to break the power of the outsiders. I think it should work along the lines of this: while these creatures have great power and seemingly endless numbers, they are not flesh and blood in the traditional sense, and so the real power lies in the material world wedged between them, hence their constant scramble to control it. The humans, at the end, are the deciding force. As far as how to make it work with the system, I think there has to be a representation that flesh and blood creatures are stronger than the daylight and midnight creatures, when the chips fall. A Lord of Daylight might be a thirty foot tall, armored angel, but an experienced human with a sword and faith can bring him down. I'm kind of wandering with that, but I like the idea, so I"ll run with it for now and see how things go as more brainstorming occurs.

@Abkajud: Your ideas of what the creatures look like are spot-on, perfect. I'm envisioning the PCs as humans caught up in the growing conflict, although the idea that one (or more) players may be disguised operatives of one side or the other could be really interesting. A PC could probably even be an open member of one side of the conflict, adding some magical and intimidation oomph to the party.

As far as what the realms are like, I've got some pictures in my brain. The Daylight Realm, I'm envisioning this huge, airy, shining city, up among the clouds, with brilliant sunlight at all times. I'm thinking a lot of silver and gold, shiny metals, marble, the things we would usually associate with noble, but overdone far beyond the point of practicality. While the city is beautiful, much of it is wasted on beauty without function. Everything is elegant and rich, but too much so, in the way that too much jewelry can be unattractive, while each piece is pristine and beautiful. The Midnight cities are built more like a necropolis, and are of course dark. The materials are solid, heavy stone, dark, glittery gems, and matte iron and steel. I'm thinking the kind of city where nothing is without purpose, things are not built for decoration but for pure practicality.

The two groups are locked in conflict because of where the real power is. Each of their realms has its own power, but the bulk of the available magic and power lies in the mortal world, which is sandwiched between them. The two groups being so radically different from one another, a few scuffles and skirmishes escalated and each side sought out the power that the mortal world held, leading them through the numerous gateways to the world where humanity lived unaware. I'm envisioning low-tech, and fairly high circumstantial magic, without a lot of overt magic (in the hands of the humans, anyways). Humans, on the whole, have to rely on wit and steel to survive.

I'm glad to see that you're still working with this concept, I think it's got a lot of potential.

Personally I'd stick with a fantasy-style main world for the moment, to get your ideas fully fleshed out in a setting that you control.

But I think the idea of applying the setting to a modern world format would be good too. Maybe save this as a sub-game or expansion book later.

If you go with the modern world first up, you'd get all sorts of religious extremists offended when you put one side as dark and another side as light, they wouldn't bother to read your book or understand how darkness and light really interact in your paradigm, they'd just dislike it because they could.

Case in point, "Harry Potter" vs "The Golden Compass". On the first hand an "innocent" romp through magic based on our modern world. On the second, a book where the author deliberately tried to make social commentary about the influence of the church. The first draws the ire of Christian extremists, the second is largely ignored as fantasy.

This sounds really cool.  When I was reading it, I kept thinking of the Russian films "Nightwatch" and "Daywatch"  If you haven't seen them, check them out, I think they'll work as an inspiration for you.  They take place in Modern Day, but there's flashbacks to ancient times as well.
  The premise is very similar to your game.  The forces of Light and Dark have been duking it since the dawn of time.  Eventually, they come to a truce, and do not openly fight one another.  They form two groups: The Nightwatch, Light operatives who monitor the Dark forces (Vampires, etc.) to make sure they are upholding their end of the truce.  Likewise, Daywatch, consisting of Dark operatives, keeps track of the Light forces to make sure they are keeping to the oath as well.  If someone goes against the oath, the respective counter-force goes in and takes them out. 
    In the very beginning, Nightwatch (The LIGHT forces) are portrayed as good and Daywatch (The Dark forces) as evil.  However, it is soon revealed that it isn't quite that cut and dry.  For instance, the Nightwatch severely restricts the vampires feeding habits to point of oppression.  Also, Nightwatch has a lot more liberty in their definition of what goes "against the oath."  The forces of Dark are not inherantly evil, but their natures (ala Vampire's need for blood) often put them in a negative light with humanity.  The Light, though they seem to protect humanity from these natures tend to be power hungry and headstrong, and seem to be using the oath to win the ancient war that they could not win through shere power.
    I'm not doing the movies justice.  If you haven't seen them, check them out.  You can rent them at most video store chains, and I even saw Nightwatch at Target for like ten bucks or something.  They're Russian, but both films have an overdub option if you don't like reading your movies.
    Anyway, just thought I would throw that out there.  I think you're on to something.

Earwig is dead on the money, Night Watch (Nochnoy Dozor), Day Watch (Dnevnoy Dozor) are actually good movies to watch for something like this but the best thing I can recommend if you want to check them out is the books by Sergei Lukyanenko, which I recommend to Earwig also cause it doesn't sound like he knew they exist.  (Lukyanenko, by the way, was heavily involved in the movies so if you don't pick up the books at least you know his core vision was maintained.)  Anyways the third movie is supposed to be coming to the states, Twilight Watch or Dusk Watch depending on which translation you read, but the book is already here.  The fourth book "The Final Watch" is on its way here as a book but not here yet.  The books contain similar stories to the movies but the books explore the concepts in question far more vastly.  For example in the first book the main character Anton struggles quite a bit with his place among the "Light Others".  Not to overload you with a book review but I've found loads of inspiration from reading books like these, and I love these books good lol.

I second StrongBadMun in urging you to read the books. They are a great treatment of the war between good and evil as well as a great look at modern/urban fantasy. The movies are enjoyable to but barely scratch the surface of the story. Also, as much as I love it for all the wrong reasons, the second movie resembles the books about as much as a fever dream about lizards resembles a tea cake... anyway, the fourth book is out in the US late next week I think?

In any case I am intrigued by the idea of the clash. I like the idea that a clash could be the action moving the hero through throngs of rank and file foes or the clash could be one important blow against a powerful foe. Have you fleshed that part out any further?

-Will

Well, I'm still trying to work out how the attributes will work, but I'm thinking I'd like to keep it to a low number. Right now, I'm thinking a Power attribute, which covers most fighty skills, a Toughness, which is your resistance attribute, and maybe a Finesse, for your dexterity-related goings-on. A lot of systems have been making a simplification of their attributes towards three, even D&D 4th is combining stuff together for their new Fort, Reflex and Will. Tenatively, I'm going with Power, Toughness, and Finesse as my three.

I haven't had a chance to look at the movies or books yet, although I'd really like to to flesh the world out a little better, and some good inspiration couldn't hurt.

As for the clash system, I'm still ironing some things out, but in my head it's basically done. Essentially, you get skills that are improvements over the attribute they are based on. For example, you have a Power of 2, and put a point into Edged Weapons, which brings it to 3. When you have a clash in which you're using edged weapons, you roll 1d10, add your 3, highest total wins. Attributes will stay fairly low throughout the game as I envision it, with 3 in an attribute being freakishly high, and 0 being the human normal. So the average human would get a 5, on average, at some task they had to do. Clashes mean that the fight with the big bad guy can still be basically blow-by-blow, but the group doesn't have to waste time cutting down his 50 minions over the course of six hours beforehand. I think it would be a great excuse to throw large numbers of foes at the players, and really get the sense that these characters are heroes, cutting a swath through an army to get to their enemies if need be. I'm envisioning a lot of combats on the scale of the fights in the first Lord of the Rings movie, if that helps anyone. You could run a fight with 30-50 enemies much faster than in a standard task resolution system, and I think it would have the right feel of 'hit, cut that guy down, cleave right on into the next one,' kind of combat.

I'll get some more collected thoughts up soon. Now that I'm thinking about it so hard again, I think I'll try to get a test drive together, iron some mechanics out at the very least. The setting still needs work, but I'm curious to see if the combat mechanics would hold up in a large fight. I'm thinking characters get the one action a round, plus any reflexive actions (parry, block, dodge). I'll let you know how it turns out, when I get the people together for it.

I'm pretty new to all of this, but your idea sounds great, though I'm sure you don't need me to tell you that. Also, I think that you clash system would work great, though would the PCs take damage too when they clash, or how would the actual mechanics of the clash work? I mean, even in the Lord of the Rings movies, you see the heros taking damage, though not much. This system actually appeals to me a lot, I've played one or two RPGs before and the minions always slow things down to an unbearable degree.

Also, the idea of two powers both legitimate fighting for control sounds like something that I have wanted to work on for a while, though mine was drawn more along political lines than philosophical lines. If you need any testers or are thinking of starting a group for this, I'd be interested, if you decided to run the game over the internet.