Purely hardware, from what we've seen so far this iPhone 5.
VERY closely followed by the 4. 4 had a brilliant new, fresh, sleek design. Great battery life, amazing screen, great camera and new antenna (plus some other stuff).
5 has a new (not as fresh) design, bigger screen (allegedly nicer looking according to Apple), facetime hd camera, lte.
Honestly can't say until I see a 5 in person, but it sounds like a bigger step. Also the battery life is better than the 4S, I'm sure many found the battery life from the 3GS to 4 slightly worse/about the same.