The first thing to consider when choosing a camera is what do you need it for - are you a professional photographer needing advanced features, a complete beginner who wants to learn photography, or a happy snapper who doesn't care about photography and just wants some nice pictures to record their memories? The truth is you probably lie somewhere between these examples, and therein lies the difficulty. There are hundreds of very good cameras available, many with overlapping feature sets so how do you choose which one is right for you? The biggest risk here is that you will probably buy something that is better than you need, rather than something that is not good enough.
So firstly, lets examine what you are going to use it for. Is this an everyday, all purpose camera or do you have a specific application in mind? If you are planning to shoot wildlife, sports, motor racing for example you will need the ability to use long telephoto lenses and you will need precision control over exposure. These two requirements immediately dictate that you will need an SLR with the ability to interchange a variety of lenses and with sophisticated programs for control of exposure and maybe auto focus too. If you're looking for something that you can carry around easily and just whip out at a moment's notice to record memories as they happen, then an SLR is too big and bulky and you haven't got time to be fiddling about changing lenses etc. so a compact camera would be more suitable. That is really the biggest decision - compact camera or SLR. If you visualise how you will be using the camera then it will probably be fairly clear which one is the most appropriate. Just one warning here - don't assume that you have to have an SLR to take good photographs. Today's compact cameras are capable of producing very good results indeed - indistinguishable from those taken by many SLRs. In fact a lot of professionals now use compact cameras because of their convenience, portability and speed of use. Great photography is not all about technical facilities, a lot of it is about timing and having the camera ready to whip out and shoot in an instant. There are a lot of great photographs that have been missed because the camera was too heavy to lug around and was consequently left at home when the photo of a lifetime was there for the taking!
Next, consider how much you want to get involved in photography. Are you (or do you want to be) a serious student of photography, do you want to have to learn as little as possible to get by, or do you want to have to learn nothing at all - just press the button? Contrary to what you might think, the last type of user is the easiest and cheapest to cater for as it is the degree of manual control (rather than automation) that sets apart the higher-end cameras. Virtually every camera these days has at least one and probably several, auto modes where you literally just point and shoot. They will usually have several different programs suitable for different applications such as portraits, night shots, landscapes, sports etc. These will cater for the majority of situations for most people and can produce extremely good results. If your needs are simple then don't be seduced into buying more features than you need - if a camera has just a few program modes that look as if they will cater for your needs then don't buy one with lots and lots - you'll never know which one to use! A key point here is that cameras with more features demand more knowledge and more skill to use them. Unless you are prepared to invest the time reading the manual, practising, and learning how to use these features, they will do nothing for you so don't waste your money buying features that realistically you're never going to use. If you are serious about photography however and want to get involved in this fascinating and absorbing hobby then you will undoubtedly want more than simple point-and-shoot. As a minimum you will want aperture priority and shutter priority exposure modes as well as full manual and exposure compensation and a number of fully automatic modes. Many of the top compact cameras offer these facilities and more so that doesn't necessarily mean you must have an SLR, although you will almost certainly want the flexibility of interchangeable lenses which would make an SLR the obvious choice for somebody who is serious about photography.
Features such as built-in flash, waterproofing, zoom, image stabilisation etc. will be largely self-selecting - you will know if you need them or not. A quick note about zoom whilst we mention it: You will see zoom quoted as both optical zoom and digital zoom - what is the difference? Optical zoom is done by changing the focal length of the lens itself to 'zoom in' or make distant objects appear closer - this is true zoom. Digital zoom (or interpolation) is electronic manipulation of the image to make it appear bigger than it is, with a consequent loss of quality. If you want your pictures to look clear and sharp, stay away from digital zoom and make sure that your camera has sufficient optical zoom capability for your requirements.
Size, portability and ease-of-use can be very important - you will know yourself how important they are to you and where they rank amongst other factors such as features, expandability etc. If you want to shoot wildlife from 600 yards away or Formula 1 cars at 200 mph you will have to sacrifice these things because your requirements are different but if you don't have specialist requirements that force you to compromise then don't overlook these factors - they make a big difference to how easy your camera is to live with (or not).
Lastly price. As with all things, you get what you pay for. The quality of today's digital cameras is almost universally good and most of them have far more features than most people will ever use. A good camera will last you many years and hopefully bring you a lot of pleasure so buy the best you can afford, however don't buy more features than you need or will ever use - that is surely a waste of money. Shop around, we have found some of the best deals for you on the cameras we feature - click through and compare them and get yourself a good deal once you've chosen what you want. Good luck and happy photographing!