I am aware that there is already a blog about this but I would like to list other features it didn't cover.

iMessage:
This built-in app allows you to send free text with picture and video between iPod, iPhone, and iPad.

Easy camera access:
Now you can take a picture without unlocking your device! When it says "Slide to Unlock" press the home button twice. There will be a camera option on the bottom right corner.

iCloud:
iCloud allows you to store music and apps online and send them to your computer or other iDevice. With iCloud you won't need to connect to your computer when an iOS update comes out. You can sync using wifi.

Reminders:
Reminders will allow you to make a note to remind you of something. When the set time comes, Reminders will notify you.

Newsstand:
This app allows you to store magazines and newspapers so that they are all in one convenient location.

Other small functions:
There are now more options for when you compose an email from your device. Safari has a Reader option which allows you to store a web page to view offline. (Good for song lyrics) Notifications are small and don't get in the way of what you're doing.
Scrolling is now possible with one finger.

Twitter:
Now you only have to login once and you will stay logged on to all your twitter apps. You can also tweet a web page in Safari and tweet a picture from your photo album.

More features will be added as I find them.