The first such improvement is the ability of tessellating polygons in real time, so that designers can create higher definition 3D characters or terrain that can be rendered smoothly without requiring much processing power. Tessellation is already supported in the Xbox 360 hardware and some graphics processors, but with the arrival of DirectX 11 we may finally see the technique used in actual games.
The next feature that should give game developers a new way to program is compute shaders. This allows programmers to use a cards graphics cores to calculate non-visual tasks like physics or video encoding and when combined with Windows 7 will reportedly help a variety of programs run faster. Finally, the third major change involves improvements in the way DirectX handles multithreading in CPUs with multiple cores to enhance graphics performance.
AMD wouldnt reveal a release date or price range for its upcoming DirectX 11 capable cards, but many expect them to have products ready in the late September - early October timeframe, just ahead of the Windows 7 launch. More DirectX 11 related info from AMD is available here and a couple of videos after the jump.