Panasonic has launched the world's first Micro Four Thirds digital camera, the LUMIX DMC-G1, which adopts a new form factor that brings the same lens-interchangeability found in digital single-lens reflex to a package nearly half the size. Initially shipping as a kit with the new LUMIX G VARIO 14-45mm/F3.5-5.6 ASPH/MEGA O.I.S lens, the 12.1 megapixel G1 substitutes a digital Live View Finder for the optical viewfinder found in DSLRs, and sports a 3-inch, swiveling LCD for picture review and menu control. Image capture gets a boost from the integrated optical stabilization, as well as an adjustable auto-focus mode that offers up to 23 focus areas. According to Panasonic, pricing for the body/lens kit and related accessories (the MFT format requires adapters and/or completely new peripherals) will be revealed sometime next month. Originally published on Friday, September 12, 2008 at 9:21AM.

Update 9.26.08: In an interview with Adorama -- cached version available here -- Panasonic executive Yasunori Takase revealed an $800 MSRP for the LUMIX G1 kit when it goes on sale in the US. He also mentioned that there will be yet another version of the camera available next spring that includes HD video capture capability along with a specially-designed lens, with ergonomic controls, built to minimize mechanical noise.