Lots of rumors, but they generally put the release sometime between late January and April.
Possible changes according to some of the repeating rumors:
- Higher resolution display (questionable, unless maybe they just increase DPI by shrinking the screen a bit)
- Lighter/Thinner/Maybe Smaller (Steve Jobs says that 7" tablets aren't any good, so probably no 7" iPad, at least not this soon)
- Facetime camera on the front (very likely, since they added it to the iPod touch)
- Photo/Video camera on the back (maybe, the iPod touch got one too)
- Faster processor (Maybe dual core?)
- More RAM (the current iPad has half the RAM of the iPhone 4 and the iPod touch 4)
- A 3G version that works with both AT&T and Verizon
Again nothing is certain, but those are the points I've seen come up repeatedly.