Top new features of Adobe Illustrator CS3
(Taken from Adobe.com)

Superior Design Features
Live Color - Explore color harmonies and dynamically apply color at once to multiple vector graphics. With Live Color, you can discover new color combinations, quickly test them, and then save and reuse them. You can preview changes to your artwork, shift an artwork’s entire tone by playing with the color wheel, or merely adjust one color with maximum precision.

Swatches panel - Save a color group to the Swatches panel so you can quickly refer back to a favorite set of colors.

Isolation mode - Use isolation mode to protect areas of an artwork from being edited. You can group, hide, lock, and restack layers with confidence, knowing that isolated portions of your artwork will not be inadvertently changed.

Better Integration
Integration with Adobe Flash - Create intricate vectors, storyboards, and test sequences without having to redraw them in Adobe Flash. Save production time with type, layers, and symbols that maintain their structure and editability when you copy/past them into Flash. You can move back and forth between Illustrator and Flash, harnessing the strengths of each program.

Symbols - Take advantage of the power of Illustrator with symbols that are now more practical to create, more easily to customize, and can be used in Flash with confidence.

Printing - When printing, preserve native color spaces. Thanks to DeviceN support, you can be assured that your artwork will separate correctly when it is printed.

Enhanced Workspace Efficiency
New Document Profiles – Speed startup when you open a new document by selecting a pre-built New Document Profile.  These profiles are tailored for different kinds of projects-mobile, print, web, and video, for example.  You can save custom profiles with startup parameters such as artboard dimensions, swatches, brushes, styles, and color spaces.

Custom workspaces - Customize your workspace with collapsible panels and new icon views. You can save your workspace as a preset and in so doing optimize your workspace for given tasks.

Operating performance - Work more fluidly and efficiently without waiting for Illustrator to catch up with your hands and your thoughts. The underlying architecture of Illustrator has been improved. You’ll notice increased scroll and zoom times, snappier refresh rates, and better responsiveness.

Access Libraries from panels – Easily access libraries of pre-built brushes, thematic swatches, and graphic styles.  Now you can quickly apply just the effect you want by pulling down your library list with an icon located in the bottom bar of the tool panels.

Advanced Drawing Tools and Controls
Control panel - Find the tool you need for the task at hand with the Control panel, which displays the options that are most appropriate for your current selection. You can access anchor-point controls, selection tools, clipping masks, and envelope distortions from the top of the screen. Workspace clutter is reduced because you don’t have to keep as many panels open.

Path editing - As soon as you select points, the Control panel displays path-editing tools You can fine-tune your work faster and even hide and show handles with one click.

Point selection - Run your cursor over any anchor point and enlarge it so you can easily see and select it. Your cursor shows a larger square anywhere it detects a point.

Point alignment - Align and distribute points just like you align and distribute objects. When you select more than one point, the whole range of alignment buttons appears in the Control panel. You can also align points to the artboard or a crop area.

Eraser tool - Quickly remove areas of artwork as easily as you can erase pixels in Photoshop. All you have to do is stroke the mouse or stylus over any shape or set of shapes. Illustrator creates new paths along the edges of the erased stroke; the smoothness of your erasure is preserved.

Click Here for the Top New Features in other Adobe CS3 Programs