PHOEBE (PHysics Of Eclipsing BinariEs) is a modeling package for eclipsing binary stars, built on top of the widely used WD program of Wilson & Devinney. This introductory paper gives an overview of the most important scientific extensions (incorporating observational spectra of eclipsing binaries into the solution-seeking process, extracting individual temperatures from observed color indices, main-sequence constraining, and proper treatment of the reddening), numerical innovations (suggested improvements to WD's differential corrections method, the new Nelder & Mead downhill simplex method), and technical aspects (back-end scripter structure, graphical user interface). While PHOEBE retains 100% WD compatibility, its add-ons are a powerful way to enhance WD by encompassing even more physics and solution reliability. The operability of all these extensions is demonstrated on a synthetic main-sequence test binary; applications to real data will be published in follow-up papers. PHOEBE is released under the GNU General Public License, which guarantees it to be free and open to anyone interested in joining in on future development.