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• some Digital Camera manufacturers have been misleading consumers, claiming that a camera supports image stabilization, when it really does not. There are two types of image stabilization: one real, one fake.
• Optical image stabilization is the one you want. While the basic concept is the same, there are two different types of optical stabilization: lens shift, and CCD shift.
• In both cases the camera has gyroscopic sensors that detect camera shake, which is caused by the tiny movements of your hands.
• The Camera then either shifts a lens element, or the CCD itself (which is mounted on a movable platform) to compensate for this motion. Typically this gives you a 2-4 stop advantage over unstabilized cameras.
• There are two types of electronic image stabilization as well, though neither as effective as an optical system.
• The first one (which has many names, such as natural light mode, high sensitivity mode, anti-blur mode, picture stabilization mode, etc) boosts the ISO sensitivity until you get a shutter speed fast enough for a sharp photo.
• The problem with this concept is that high ISO = more noise.
• The other type of electronic image stabilization is when a camera applies some kind of post-processing to a photo, trying to remove the blur.
• Most often this is like using "unsharp mask" in Photoshop. This too adds more noise to your photos.

So, you want an optical IS system, since it gives you sharp photos without an increase in noise.

Also read these articles....

The Two Types of Digital Cameras

What Are Megapixels & Should I Care?

What is an Autofocus illuminator and is it required?

Things you should look after while buying your Digi cams

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