The new 5-megapixel Canon PowerShot G5 cuts to the front of the line in Canon's lineup of point-and-shoot digital cameras. At $800, this isn't the camera to get your mom started in digital photography. But the G5 will appeal to hobbyist shutterbugs who can't afford the $1,500 price that digital SLRs command.

The G5—and similar cameras like the Nikon Coolpix 5700 and the Olympus Camedia C-5050—have a lot to offer displaced 35-mm SLR users. The G5's image quality isn't at the same level as that of the digital SLR cameras we've tested, but it is excellent for a compact camera.

Although the G5 includes only one interchangeable lens, the built-in 4X lens (equivalent to a 35- to 140-mm lens on a 35-mm camera) should provide more than enough flexibility for most users. And the G5's fine close-focus macro feature lets you get up close on small objects. For users who want to go beyond the basics, Canon offers add-on telephoto, wide angle, and close-up lenses, as well as a wide range of external flash units.

The G5 is a pleasure to use. On the outside, the G5 has a businesslike flat-black finish in place of previous models' satin aluminum look. Canon's trademark twist-and-flip screen has been slightly improved; it now folds completely flat against the camera body when not in use.

The G5 is one of the first cameras we've seen to include an orientation sensor. The camera (and Canon's excellent ZoomBrowser image viewer software) knows which pictures were taken vertically, so vertical shots display vertically on your monitor without your having to rotate the image.

Despite its point-and-shoot mission in life, the G5 has a very complete range of manual controls. Its exposure meter and automatic white balance performed better than most compact cameras we've tested, producing good color and accurate exposure even in difficult lighting situations. Like Canon's SLR cameras, the G5 uses a short preflash to determine proper flash exposure, which helps avoid washed-out pictures taken with flash at close range.

Compared with the Pentax Optio 550, our current Editors' Choice among enthusiast cameras (see "Snap Happy," September 2), the G5 is better in every way. In fact, the G5 delivers the best image quality we've seen yet from a digital point-and-shoot.

The unit comes with a 32MB CompactFlash card, a lithium ion battery, a charger, and an infrared remote control. Battery life is indeed impressive: We took more than 400 pictures (with extensive use of the LCD screen for framing and image review) on a single charge.

The one drawback is inherited from the G3: At the widest zoom setting, the camera's lens blocks part of the view in the optical viewfinder. But for many users, the great images and excellent battery life will be enough to compensate.