Adobe's latest release is definitely worth the upgrade.
Every 18 to 24 months, just when it seems like you've finally gotten used to all of the features in the current version of Adobe Photoshop, a new version comes out. This time it's CS5 ($700, direct for the full version; $200, upgrade), which is actually the 12th iteration of this mother of all image editors.
While CS4 boasted plenty of useful upgrades, it was heavy on stuff (like 3D and video) that didn't mean much to the average still photographer. But, CS5 has lots of new features most shooters will find useful. So if you didn't upgrade from CS3 the last time around, you'll get a dramatically improved program now. Adboe used to let you upgrade from any version of the software, but now you'll get an upgrade price for CS5 only from CS2 or above-if you're moving up from CS, you'll pay the full freight.
The biggest news? This version includes a vastly improved HDR tool, a better Refine Edge dialogue that makes complicated selections and masks simpler to create, a new Content-Aware Fill for removing spots and objects, and an improved Camera Raw processor.
There are also a whole bunch of smaller improvements for regular uses of the software, plus interesting and addictive tools such as a juiced-up painting engine and a new lens profiler.
And then there's performance. While the Windows version went to 64-bit at CS4, Mac users (who must have an Intel machine to run CS5) now also have 64-bit capability. This matters if you have more than 4GB of RAM-the 32-bit software could make use of only that much. So if you have more than enough RAM and a 64-bit OS, you'll really notice better performance when, say, you're merging a bunch of images to HDR or using the new Content Aware Fill tool.