The Redstone Update brings improved minecarts, including special tracks to unload unwanted livestock and an option to link carts together. The update also adds a daylight detector that can be hooked up to a capacitor to create a solar-panel-type device, a new ore based in the Nether that can be used in capacitors, and fireworks for New Year's Eve. Whether this means 1.5 will hit on New Year's Eve remains to be seen.
Mojang is also fixing a few bugs, including the south-east rule. The south-east rule is a glitch that affects some objects based on their compass coordinates, causing them to gather, generally, in the southeast quadrant of an area. This fix may impact some designs that exploit the south-east rule.
The Redstone Update is the first in a series of single-feature-focused updates. Mojang plans to launch one of these every two months.