List of new stuff confirmed for 1.8 (from PAX)
Volcanoes will not be in 1.8, but Notch confirmed they are possible and could be coming in the future.
Biomes will be much more distinct, and rivers will separate some of them.
Endermen will have a two block reach and will teleport to attack you when you move your crosshairs off of them. They do, however, have a major weakness: Water. If you can lure them into chasing you into water they die off fairly quickly. They will also collect blocks to make geometric shapes. They are considered rare, but you can get your first glimpse of them at around 9:30 in the video above.
Silverfish is some sort of new random mob.
Oceans are much larger and with randomly dotted islands.
Rain has been improved, “like a thousand times better” according to Notch.
NPC Villages are ready to go, but not the characters themselves, they will be released down the road. They will be peaceful and leave you alone unless you attack one. Sort of like Zombie Pigmen in the Nether. (A village is shown in the video above around 3:30)
Speaking of the Nether, there will be no updates for the Minecraft underworld just yet, but there will be at some point in the future.
Lava and torches will have new lighting effects, and in possibly one of the most exciting updates, torches will give off light in your hand while holding it.
Zombies will now drop rotten flesh as opposed to feathers (which never really made sense, anyway).
Bows & Arrows have new animations, and charged arrows will have a lot more power and fly further. (You can see Notch use it in the video above around the 5 minute mark)
You’ll finally be able to grow pumpkins thanks to seeds.
Melons have been added and can also be grown in farms.
You will now have a Hunger Bar on your HUD. The more you sprint, the hungrier you get.
There is now an animation for eating, and it also takes a few seconds now instead of being instantaneous.
Tables. Finally … tables. No more just placing a wooden block and making people think it’s a table.
Glass panes will be super thin glass and you can remove them unlike glass blocks.
“Dead Mine Shafts” will be randomly generated like Dungeons and will feature rails, torches and wooden pillars. (13:30 in the video)
New Creative Mode will allow you to fly, hover, instantly destroy blocks – including Bedrock – and spawn items in unlimited numbers. You will be able to pull up a menu and just click on the items you wish to create. Admins will be able to turn this on and off.
Killing animals and mobs will now drop Experience Orbs, and you gain skill points by filling up your XP bar, but you can’t do anything with those points … yet.
Due to the number of updates, 1.8 updates may come in parts. (i.e. 1.8.1, 1.8.2)