Smart playlists have been a feature of iTunes since version 3.0 (circa 2002), and they provide a means for you to create automatically-updated playlists that fit a certain criteria. For me, they serve as a hands-off way to stay up-to-date on my latest music and Podcasts, as well as a repository for a certain genre of music. To create a smart playlist, click on "File" and select "New Smart Playlist" (or you can use the command-option-n keyboard shortcut).
If you want a playlist that contains only holiday music, you could specify that the playlist include all songs with either the "Christmas" or "Chanukah" genre tag on it. Because smart playlists auto-update, you needn't worry about adding songs to it: as long as the track's tags meet the criteria, it is automatically included in the playlist -- unless, of course, you choose the "limit to" option, which limits the the tracks in the playlist based on your choosing.
Read more for five of my favorite smart playlists, as well as criteria for how to create them.