A little over ten years ago, I worked on Microsoft Bookshelf, an CD-ROM reference product that had a dictionary, thesaurus, book of quotations, concise encyclopedia, chronology, atlas, and almanac. (Later on we added other stuff like an internet directory and ZIP code directory.)
One of the fun projects each year was to select the new words to add to the dictionary; at the time, it was stuff like assault rifle and ebola. Unfortunately, we stopped making that product after Internet pretty much made in unnecessary. (It was still a cool product -- the first CD-ROM title from Microsoft.)
However, dictionaries still need add new words each year to reflect changes in the language. This year, the people at the New Oxford American Dictionary announced that unfriend was the word of 2009.
unfriend: To remove someone as a 'friend' on a social networking site such as Facebook.
Other terms they're adding to the dictionary next year include netbook, hashtag, death panel, funemployed, tramp stamp, and teabagger. There were also a slew of new Obama related terms such as Obamanomics.
I think the new words are a very interesting view of our times.
For more, check out the Oxford University Press blog post.