The Linux 2.6.35 kernel brings forth ATI Radeon power management improvements, Radeon DRI2 sync and swap support, Intel H.264 VA-API acceleration, and many other graphics DRM changes. Beyond the DRM there are updates to the Btrfs file-system as well as EXT4 and many other changes in the 400+ merges.
As we shared a few days ago, the Linux 2.6.35 kernel has major performance problems, but that may soon be resolved once our kernel performance tracker reports so. It is the Linux 2.6.35 kernel that is going to be used by Ubuntu 10.10, among other Linux distributions updating early in autumn.
The Linux 2.6.35-rc1 release announcement can be found at LKML.org.