Dynamic topology is a new sculpting mode that subdivides the mesh as needed, whereas regular sculpting only affects the shape of a mesh. This makes it possible to sculpt complex shapes out of a simple mesh, rather than just adding details onto a modeled base mesh.

Initial support for hair rendering was added, with triangle strips, cylinder or bezier curve primitives.Multiple importance sampling for lamps, preview rendering is available inside the properties editor, new closures and optimizations for OSL, non-progressive integrator was improved and support for packed, generated and movie textures was added.

The image pipeline has be refactored to handle transparency in images better and compatible to standards. There are two alpha types for images that are useful for different purposes, and we now try to automatically do the right conversions and operations.

The character physics type received a number of new options, profiling and debug information has been cleaned up, and simple shadow maps can now take clipped alpha transparency into account.

Collada import and export was improved for animation: shape keys are now supported, and the armature modifier has been made more stable, respecting axis orientation and scene scaling.

Added MilkShape 3D format support and EDL Video Import.