This version supports a new particle system with hair and fur combing tools, fast and optimal fur rendering, a mesh deformation system for advanced character rigging, cloth simulation, fast Ambient Occlusion, a new Image browser, and that's just the beginning. Check the extensive list of features in the log below... have fun!

Hair and Fur

Many features have been added to make fur and grass rendering for Peach possible. Big improvements were made in visual quality, rendering speed and memory usage.

Image Browsing

The new Image Browser is blazingly fast and stable, and not only allows to browse for images in your filesystem, but can also show previews of materials, textures, world, lamp and image data.

Glossy Reflections

Reflections and refractions are now possible to be rendered with a glossiness factor, controlling the roughness of material.

Render Baking

Great tools for making UV textures: you now can bake normal maps based on rendering a higher resolution mesh, you can bake displacement (including 32 bits depth), and you can bake transparency.

Physics caching and baking

The softbody, cloth and particle physics now use a unified system for caching and baking. For real-time tweaking, a new option "Continue Physics" will continue the simulation regardless of the current frame.

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Armature Drawing

Armatures now support Bone groups, custom Bone colors, automatic colors, more custom shape options, ... and many more goodies for our rigging department.

Armature Tools

Many new tools and improvements have been made to speed up the rigging and posing workflow. There are now tools for more intuitive bone creation, various hotkeys to speedy batch-editing of bones, auto-ik and auto-keyframing tweaks, and many more goodies.

Skinning improvements

Bone Heat Weighting is a new method to create vertex weights for bone deformation, it generates better results, and does not require setting a radius for bones. Also added was Quaternion-Interpolated Deformation for superior blends.

Game Engine improvements

The Blender GameEngine has seen a great deal of improvement with an increase in play-back speed, a number of nice new features including 2D filter compositing, and of course attention to quality through bug fixes.

Soft Shadows

Raytraced soft shadows are now possible for all lamp types; including spot, sun and point lights.

Render Pipeline

FSA gives superior anti-aliasing for high dynamic range and compositing. Zmasks allow rendering of composite masks. Instancing gives efficient memory re-use for duplicates.

Shading features

Cubic shading (to prevent discontinuity banding)
Higher level texture coordinates for duplicates (like feathers)
Lamp fall-off curves
Softer Halos, premul alpha, multisample shadowbuffers, ...

Python Scripts and API

There have been a large number of script additions and script updates, as well as API improvements since the last release.

Particle system rewrite

The particle system has been rewritten from scratch. It now allows advanced hair grooming tools, but also much better physics, boid animation and even explosions!

Cloth simulation

Cloth simulation is available in Blender via a modifier on Mesh objects. Cloth then realistically and in real-time interacts with other objects, the wind or other forces, all of which is fully under your control.

Approximate AO

Ambient Occlusion is a render option that darkens areas with less visibility, simulating the effect of environment light. This new AO option is based on quick approximation, giving many factors of speedup.

Mesh Deform Modifier

This new method allows to use any random Mesh cage to become a deformation "lattice" for animated characters. By layering - using both a MeshDeformer and an Armature, you can both achieve high level as precise control.

Action Editor improvements

The Action Editor has been rewritten to have a more flexible codebase that is more future-proof and extendable. This has enabled tools to be shared between the editing modes for Actions and ShapeKeys, and now has many new features...

Constraint System

Constraints are crucial for setting up good character rigs. A wealth of new features have been added to improve and extend this system. Most notable is the addition of PyConstraints, allowing full control to animators.

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QMC & Adaptive Sampling

Blender now includes two new sampling methods, using a Halton sequence (Adaptive QMC) and a Hammersley sequence (Constant QMC).
Raytracing now also supports adaptive sampling.

Sequencer

Many many new goodies in our Video Sequence Editor:

UI made more accessible, new panels/views
Built-in strip blending
Color correction tools
Markers, NTSC support, preview, ...

UV texture editing

UV texture coordinates now are accessible via regular Mesh editmode. And many more features were added such as:

UV draw types
Solid opengl view with textures
2d cursor in Image window

Node editor

New nodes have been added for shading and compositing.

And more features

NDOF devices support
Align to Transform Orientation
Pole target for IK chains
Pose Libraries
Weight Paint visualization
Multi-Modifier support
Weight-group selecting
Custom transform orientations
Distributed rendering options
External Paths Tools
Automerge
Recursive Dupli Groups

This is the upgrade release of 2.43, with mostly bugfixes and a couple
of nice new features, among which 64 bits safety and SSS render.

New features
Duplicator system was rewritten, now inheriting draw type from parent, and allowing selection on all children.
Hold SHIFT+MMB in camera view, shifts the viewport around.
Empty Object type now has 2 choices for drawing, including an option for the scale.
CTRL+C "Copy Attributes" menu got many more options
Caching Object transform speedup collision for SoftBody system
New mouse cursor icons for Paint
SCons build system was rewritten: mediawiki.blender.org/index.php/BlenderDev/SconsRefactoring
Curve Objects now have a "render resolution", so you can use a lower resolution in 3D window display.
Image texture mipmapping was extremely slow on large files (5×5k image took 25 seconds), this due to bad filter code. Recode made it 10 times faster, filtering mipmaps now is option in Texture buttons. Without filter it's 50 times faster.
Shadow buffers now have filtering options: www.blender.org/bf/filters/index2.html
Added "Copy Scale" constraint.
Added "planar" Environment map type, for flat mirrors. Current default is to render the cube side that points to the positive Z axis direction. A new "Zoom" value allows to zoom in or out for better resolution of reflection.
Soft Body now allows to bake with local coordinates, so you can re-use or further animate the baked object.
Baking all selected Soft Body: press CTTRL+B in 3d window.
Curve Objects with bevel, but without front/back or extrude depth, now render as a full circle instead of 2 halves.
Text Objects default have "filling groups", to ensure a character that overlaps another doesn't create a fill conflict. On a ALT+C "Convert to Curve" you now can choose whether or not to keep using this.
The step size for arrow keys to advance +10 or -10 frames now is a preset (Time Window menu or Scene buttons).
The 3D window now has a rotating icon to show axis orientation.
While Weight Painting with a Object in Pose Mode, hotkey key-pad zero now centers on active bone.
Texture space transform in 3D window (T key) now supports constrained transform.
The "Re-open Last Saved File" (Ctrl+O) option now stores a history of 10 files.
Material masking option "Env" now also masks out ZTransp faces.
Fly mode (SHIFT+F) was redesigned, now works in all three view types - ortho, perspective and camera. The header gives hotkey hints how to use it.
Added an 'eyedropper' tool in the colour picker. With the colour picker open, you can click on the 'Sample' button, to sample any colour on the Blender screen. Very useful for compositor, now waiting for a good chroma key node!
Spherical light probes for AO render now uses filtered samples in the probe image.
"Transform Properties" Panel now also shows actual dimension of an Object.
Texture type "Stucci" now returns a an intensity value too, useful for previews.
Outliner now shows driver Objects too.
Image extensions (when option is chosen) is now used for screen capture and Image Window saving too.
Weight Paint: new option "Soft" can be disabled, to enable setting weights on vertices in a single click.
The CTRL+F3 option to make screen captures now works on (pop up) menus. Just press this hotkey twice then. (Note this is ALT+CTRL+F3 in OSX).
Play option (animation player): press LMB to see which frame is displayed.

Important bug fixes
Image textures with repeat rendered with completely wrong filter (2.41 bug).
Replacing SDL thread code with pthread library solved many reported problems. Several cases of not threadsafe code were resolved.
Nurbs surfaces and Beveled text now have correct "orco" and UV texture coordinates in cyclic cases
Relative paths for Images in Library files now work
Vertex/Weight Paint gave corrupted (or crashing) results when painting outside window border.
AutoSmooth now works well for animated Objects too, using original un-transformed coordinates.
Maximum limit for render faces went from 8M (quads) to 128M.
Multiple fixes in filename string handling, for all OS'es. Note: built-in max filename length is still 240 chars.
Using multiple levels of chained "Set" scenes now works properly.
Environment map render now survives when its reference Object gets scaled.
Color Picker popup did not redraw all sliders when used.
In several Linux distros, the ESC hotkey for exit rendering didn't work.
When saving out JPEG images, no alpha is written anymore, was not according to JPEG specifications.
ALT+A playback kept adding events in queues, causing memory issues (crash) when leaving it play like for a day.
Rendering Halos was done unsorted, whilst the sorting code was there... now this works again.

Known issues
The translation system has big problems in deciding what buttons to translate or not, it can also not correctly display file names with special characters.
Although work has been done it in the past period, Blender's code is still not full 64 safe. For actual use, it is not recommended to compile a 64 bits Blender yourself. This should become a target for the next release.
Yafray: for the 2.42 version you need to upgrade Yafray as well.
Windows: without a TEMP path set in user settings (Info Window) you cannot use the render "Save Buffers" option.
Render: AO option "Use Distances" does not work for colored AO, only for "Plain".
Systems with Intel on-board graphics can expect bad updates in UI for buttons, menus or border selecting.