Canon EOS 1000 SLR and Canon Ixus IS120 P&S
Any serious photographer will necessarily use a digital SLR. However, I have seen many beautiful photos in Flickr which were taken with Point and Shoot cameras. So, why upgrade to SLR?

Some basic definitions first. These are extracts from wikipedia:
§  A point-and-shoot camera, also called compact camera, is a still camera designed primarily for simple operation. Most use focus free lenses or autofocus for focusing, automatic systems for setting the exposure options, and have flash units built in.
§  A single-lens reflex (SLR) camera is a camera that typically uses a semi-automatic moving mirror system that permits the photographer to see exactly what will be captured by the film or digital imaging system (after a very small delay) 

Practically speaking, P&S cameras are usually very compact and provide fully automized functions, although some can provide semi-manual modes. SLR cameras, on the other hand, are bulkier and provide more options to manually select settings.

Some of the advantages of SLR cameras are:
§  Ability to choose between different exposure modes: usually  Automatic, Aperture Priority, Shutter Speed Priority, Manual and, sometimes Depth Of Field Priority. Some P&S cameras might also offer some or all of these modes
§  Ability to use automatic or manual focus, which none of the P&S I know offer
§  Larger image sensor, allowing for a higher signal-to-noise ratio, thus allowing better output in extreme conditions
§  Ability to use an external flash allowing for more control over lighting
§  Specific functions as Depth Of Field preview, exposure bracketing, …
§  Ability to shoot in Raw format, allowing more options for post-editing.

In short, SLR cameras give you room to express your creativity by completely controlling the way the camera behaves

On the other hand, P&S have the advantage of being compact and much easier to use. Many of them offer very high resolutions and good focal length range, as well as some of the advanced functions of SLRs.

My choice went to SLR several years ago. However, I still use P&S from time to time, as it is handier and can be taken anywhere, anytime.

What’s your choice?