This is an excerpt from the Microsoft SharePoint Products and Technologies Team Blog.

Microsoft ASP.NET AJAX 1.0: A Background

Microsoft ASP. NET AJAX 1.0 lets developers build Web 2.0 sites using the latest Ajax techniques. 

ASP.NET AJAX extends ASP.NET 2.0 and makes several new tools and techniques available to help you build applications more quickly:

• Extensions to JavaScript.  ASP.NET AJAX extends the JavaScript library to bring standard object oriented concepts to JavaScript.  It brings a formal type declaration system, with support for inheritance.  It also provides a significant number of out of the box types, including types such as Sys.Net.WebRequest for working with web services.  Finally, it helps to abstract some cross-browser issues such as XML element traversal.  This makes it much easier to create robust JavaScript libraries and frameworks which are commonly needed by rich internet applications.
• ASP.NET Control Extenders.  Extenders are additional ASP.NET controls which can extend the functionality of existing controls with additional Ajax capabilities.  A common example is an extender which allows existing textbox controls to have autocomplete functionality with no modification to the extended control.   (The autocomplete extender is included with the ASP.NET AJAX Control Toolkit.)
• UpdatePanels.  UpdatePanels allow your existing ASP.NET controls and web parts to achieve the fluid, no-postback updates of Ajax-based applications with minimal re-coding of your control or part.  Quite simply, controls within the UpdatePanel control which ordinarily would post back to update their data will now be routed through an Ajax-style callback, resulting in a silent update back to the server.  This makes your application “postback” much less, making interaction with your control more seamless.

With Microsoft ASP.NET AJAX 1.0, you can build more dynamic applications that come closer to the rich style of interruption-free interaction you may see in standard client applications.