1. Motion Detection i.e. comparing the current image to the one before - standard features you've seen with any camera peripheral on a console are a given with this.
2. Depth Perception e.g. pushing towards the screen to select, water in Milo only interpreting hands as touching water, people in foreground silhouetted against background - unless there is a program I don’t know of this would require 2 cameras spaced apart like how our eyes work. Partially the reason why the natal is a long bar. Means natal can tell what is foreground or background and things moving towards and away from it.
3. Real-time motion capturing model input i.e. mapping your motion to an on-screen character - natal knows what is an arm and how it is moving even down to spotting whether a hand is open or closed. More interactivity and perhaps more realism if implemented properly e.g. player punching awkwardly can be translated to the game as his well trained character punching well or as his character punching as badly as the player.
4. Facial Recognition i.e. recognising you as you - may be more basic than suggested it is by demo but this allows for personalisation to each player and multi-player tracking. Further immersion as well, as demonstrated by Milo.
5. Voice Recognition i.e. recognising aural commands/ speech - further immersion while eliminating any other need for a controller in interacting with natal.
6. Colour Extrapolation e.g. Milo commenting on player using orange in the picture drawn - different colour objects can be interpreted differently by the game allowing anything from a 'green screen' effect to detecting props and distinguishing different same shaped props by colour.
7. Hinted at OCR/Object Recognition i.e. recognising an object/picture or text - Not shown but the demo hinted that Milo could identify the picture drawn so if so perhaps he could interpret text as well. Montage also showed natal recognising a skateboard as such and scanning it into the game. Such a feature would give a lot of functionality depending on how it is incorporating, from customised game content to bridging the gap from the virtual world to ours.

All in all, the Natal uses our bodies and senses to controller a game. These things, we are more accustomed to than a controller (at least I hope so) and so bring a new level of intuitiveness never before seen. I can't wait to see more.
At least we will still look like idiots