Apple's Scott Forstall was quoted saying,

"We've already seeded 100,000 developers, and they love it. We can't wait to get it in other peoples' hands."

Here are the top new features of iOS5:

• There's notifications, visible from the top by swiping down. No more annoying popups from Tiny Tower.
• Swipe across any and it'll take you right there. Bam.
• Then there's iMessage -- BBM for iOS, basically.
• Twitter integration "we have integrated Twitter deeply into the OS." No more signing in multiple times, and you can share pics right from Photos.
• Newsstand - GQ, Allure, Vanity Fair, The New York Times... lots of periodical powerhouses.
• Background downloads for new issues -- hey, that sounds like Distro. Which is coming soon, by the way...
• We're looking at the updated Camera app now. "We're making it really easy to get to the camera and take a photo." Double-tap on the home button and, bam, you can take a pic. - And, you can use volume up to take a photo. Not a proper shutter release, but it'll do.
• Now Game Center, updated to add photos of friends, achievement points, friend recommendations...
• Now Safari updates, talking about the reader function that strips out all the junk and pulls things into a single, readable page. "This works great on the iPad, it's fantastic on the iPhone." - You can add it to your reading list and hit it up later. - Syncs between iOS devices -- save once, read everywhere.
• Full tabbed browsing is coming to the iPad, so you can go between them with one tap instead of two.
• Mail updates now, adding rich formatting. Indentation, moving addresses around, flagging them...
• Now Scott's recapping the PC Free feature, so you can activate your device without plugging in. "There's no need for a computer." And, you can get wireless iOS updates.

The new iOS 5 will be launching on October 12th!

Source: AppleForums.net via Engadget - Live Blog of Event