From TDN

Right now, the only compiler that is supported by GarageGames for compiling TGE on Microsoft Windows is: Microsoft Visual C++ 2005 Express Edition

There used to be a package called Torque Build Environment that was supported up through TGE 1.3, but it was too much hassle to maintain -- especially when there was an excellent free option in the Express edition of Microsoft Visual C++. When Visual C++ Express is no longer offered for free from Microsoft, the issue of finding other compilers will likely be brought up again, but for now, GarageGames officially supports only Express.

For more information on this issue, please see Chris Calef's post "Torque Build Environment (TBE) Changes Course".