There's a variety of new Nikon tech in the D7000 over older models, including a new Nikon-designed 16.2-megapixel sensor coupled with its Expeed 2 processor; with this pairing, Nikon ups its analog-to-digital conversion to 14-bit processing. There's also a new metering sensor and more sophisticated autofocus system. It's also Nikon's first dSLR to rise to 1080p HD video--albeit only 24fps--with the "added bonus" of full-time autofocus during video capture.
Photo quality is first rate, and, despite the resolution increase, stands up very well against the D300s as well as most competitors. Though I'd probably say the D7000's JPEG photos are clean up through only ISO 800, they remain very good through ISO 1,600. By ISO 3,200, shadow detail gets pretty noisy. You can eke out about a stop more of usability out the D7000's medium-high ISO sensitivities by using raw instead of JPEGs, or at least by tweaking the default camera settings. Granted, the images aren't noise-free, but the monochrome-grain appearance is more attractive than the in-camera err-on-the-side-of-color-noise approach, and there seems to be enough dynamic range that there's still shadow detail and little loss of sharpness.
