Fix for glitchy mob prediction in multiplayer
Large amount of internal changes
Silk Touch will be able to pick up Ice and Glass Panes
Stackable items now stack outside inventory when thrown to the ground individually
Easier item manipulation within inventory
Brewing stands allow use of shift clicking to put items in it
⇧ Shift+clicking can now be used to wear armor
Dispensers can place Minecarts on rails and Boats in water
While in Creative Mode, players can supply a powered minecart with fuel by right clicking it as if they were holding coal
Flying in Creative Mode is no longer affected by water and lava
Commands in Singleplayer
Optional bonus chests placed close to the player when creating a new world
Demo mode playable through non-premium Minecraft.net accounts
Different crafting recipe for books
Added Book and Quill
Ability to write in books (up to 50 pages), save them to edit later, and sign them and title them to finish off the book.
New slabs of the 3 new plank types.
Wood slabs behave as wood, not as stone.
Cocoa Beans drop from jungle tree leaves at the same rate as apples.
Cocoa Plants that generate on the sides of jungle trees, which can be harvested for cocoa.
Cocoa Beans have a new texture.
All multiplayer sounds have been fixed
Fishing lines are now visible in SMP
Hardcore in multiplayer (HMP)
Better chunk loading in SMP
Villagers spawned from spawning eggs will get a random profession.
Wooden tools can be burned in furnaces.
Shift clicking in creative
Singleplayer will be a local server
Wood planks and logs will have proper names (e.g. Spruce Wood, Birch Wood, Oak Wood)
"Large Biomes" world type
Specific names for different sandstone and smooth stone blocks.