The heart and soul of Linux, the Kernel was updated to 3.5.  Vast improvments in networking support, updated support for various items such as  metadata checksums in Ext4, userspace probes for performance profiling with systemtap/perf, a simple sandboxing mechanism that can filter syscalls.Linux 3.5 Minor IRQ handling improvements for virtualization, and expanded tcp-ip 6 support.

The full list of changes can be found here, and for those who want it, can get it here.