Android: Ice Cream Sandwich is bringing a lot of awesome new features to Android, one of which is a new and improved keyboard. If you can't wait to get your hands on it, you can download the Ice Cream Sandwich keyboard in the Android Market right now, no root required.
The new keyboard has better targeting, a simpler suggestion bar (akin to something like previously mentioned SwiftKey), and some pretty neat shortcuts, making typing out long text messages just a little bit easier. This port of the keyboard doesn't come with any of the other new features — like better copy and paste or text selection — but it is a bit easier to type on, and could even replace Swype as my default keyboard for a while. If you prefer the more traditional-style Android keyboard, you'll definitely want to check this one out. Note that the keyboard's speech-to-text button doesn't work on older versions of Android, though, so if you're a heavy user of that, you might want to wait (or just long-press the search button on your phone) instead.
The Ice Cream Sandwich keyboard is a free download for Android phones running 2.2 and up.