Minecraft Beta 1.2 is live. All servers need to be updated to 1.2.
Note blocks (right click to tune, trigger to play)
15 wool dyes
A new water dwelling mob
New tree types
Reeds magically turned into sugar canes. They still make paper.
A bunch of new crafting recipes
One secret useful block
One secret pretty block
AND MOAR, probably. I forget!
Paintings work in multiplayer
Disconnecting while riding no longer keeps the player in the world
A bunch more state is properly synced in multiplayer
Fixed colours going weird on PowerPC
Fixed a horrible chunk reload loop in singleplayer
Fixed most lighting bugs in newly generated SMP maps
Falling sand behaves better in SMP
Fixed a few crash on load level bugs