The Eclipse Project has released Eclipse 3.4 Ganymede, their open integrated development environment for Java. Version 3.4 adds numerous small new features and user interface improvements. There's no one killer new feature here, but the gradual accumulation of small improvements does add up over time.
For the last few months I've been using IntelliJ 7 in my day job on a regular basis, so I think I can finally reasonably compare these two. IntelliJ has the reputation of being more expensive but much more productive, while Eclipse is thought to be somewhat rougher but free. After several months of using IntelliJ in anger for the first time, I have to say that while this may have been true a few years ago, it isn't true today. Eclipse is far from perfect, but it has noticeably better refactoring, code completion, editing, and browsing facilities. IntelliJ's Swing UI looks prettier than Eclipse's SWT UI, but the user experience is far inferior. IntelliJ still screws up basic things like the keyboard shortcuts for Close and Find Next. I can work with IntelliJ because I have to (certain proprietary plug-ins our build system depends on have been developed for IntelliJ only) but I don't like it. Coding in IntelliJ is like being working with my keyboard covered in hot tar. Coding in Eclipse is like working with my keyboard covered in hot molasses, bad but better than the alternative.
I won't say Eclipse is the best IDE for Java. I've still never really used NetBeans 6 in anger, so it may be superior. I don't know. But I am willing to say that in 2008 that there's no reason for most programmers to pay money for a Java IDE. Whichever IDE is the best one, that IDE is a free IDE.