Custom terminal directives: It is now possible to author custom terminal directives (like v-if and v-for). See docs for details. (@kazupon)
Improved v-bind:class syntax: It is now possible to mix objects inside arrays (@FadyMak):

  <div :class="[classOne, { classTwo: true, classThree: false }]">
  </div>

is attribute can now be bound to an actual component constructor in addition to string Ids. This makes it possible to pass down components as props and then render it using dynamic component:

  <!-- pass the registered "item" component as a prop -->
  <example :component="$options.components.item">
  </example>

Inside <example>'s template:

  <!-- just bind "is" to the passed component -->
  <component :is="component"></component>

1.0.18 regression: data functions that do not return an object should not cause a crash. A warning has also been added. (#2517, #2528)
1.0.18 regression: fixed a few cases where props reactivity not working as intended. (#2516, #2549)
#2542 fixed elements with transition occasionally stuck on leave when removed right after enter.
Boolean props in the form of a="a" should be interpreted as true, just like HTML boolean attributes. This also deals with cases where html-minifier auto expands boolean props with no value.
Fixed cases in IE9 where classes are not merged properly during transclusion.