.dts is the file extension used by models for Torque games, and since Blockland uses it, it uses the format as well. It stands for Dynamix Three Space, the first word referring to the company that developed the format for use in Tribes 2, the rest being a shorthand term for three dimensional space.
Models can be exported by a wide variety of programs, notably Milkshape 3D which can export natively without the use of plug-ins. As well as Blender and 3DS Max, which can export with the use of plug-ins. Later versions of Blender, however, do not have a functional dts exporter yet, which can be an inconvienence for modelers, especially new ones.
Although many programs can export to .dts, very few known programs can import it. A recently abandoned program called Shaper is the main resource for doing so.