The game features an "overhauled" foliage system as well, with the article noting that artists can now manipulate the animation properties of trees, allowing them to whip around in the wind, for example. A new precipitation system will also facilitate realistic snowfall, something you're likely to see a lot of in Skyrim, a much colder land than Oblivion's Tamriel.
Character animations and interactions have been upgraded as well. Oblivion players will be happy to hear that the game world no longer freezes when a conversation is begun. Now, instead of entering a one-on-one closeup with another character, the usual camera angle is maintained while the character continues to go about his business while conversing. As an example, a bartender may clean the bar while talking with the player.
Skyrim also utilizes a new "Radiant Story" quest system, which allows the game to personalize side quests for each individual player. Rather than simply offering a prescribed list of quests in certain locations, the game can tailor quests to each player based on where they are, which characters they've met and what their skills are.
Finally, Game Informer has released the very first screen of Skyrim. Chances are good that you already saw it before reading this far down. Check out Game Informer for more details on the tech behind Skyrim.