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Recently we published a new whitepaper to MSDN written by Scott Allen that explains what T4 is and how the Entity Framework uses it for code generation.  It starts with an introduction to T4, covers editing and debugging tips, and shows how you can use it to customize and take total control of your generated classes.  The article's extremely detailed and contains everything you need to get up and running with T4 and EF4!

T4 Templates and the Entity Framework