The type of software that allows users to create and edit text documents is known as a word processor. Popular examples include Microsoft Word and Google Docs, which provide intuitive interfaces for formatting text, inserting images, and collaborating in real-time. These applications support various file formats and offer features like spell-check, grammar suggestions, and template options. Word processors enable users to efficiently document, edit, and share written content, making them essential tools for students, professionals, and writers in various fields.