Currently only available for Permanent Users, you can "subscribe to"/"track" comment threads/entries and... here's what I think is super-awesome... I went to try it out on an entry and one option was to track "All posts tagged [drop-down menu] on [journalname]" !!! Weren't we all hoping for something like this when they first rolled out tags? (i.e. a way to filter your readinglist to stuff you're interested in) This is actually awesomer than what I think users were imagining back then, 'cause this lets you subscribe to specific tags by people not even on your flist. (Of course that necessitates that people actually use tags.... I was resistant to tags when they first came out because the interface is so much worse in S1 than in S2 -- and I really dislike S2, which the LJ PTBs totally have a hardon for -- and because I worried they would supplant Memories, but used well they make my organizational heart glee.) It's e-mail notification, which I can see arguments on both sides, but since we already get comment notifications via e-mail I'm fine with it.
Edit: Ooh, you can also be notified by e-mail when someone friends you -- which I think will mostly be positively received, though it will up the drama a smidge. (I'm a little weirded out that you can choose to be notified when people upload new userpics.)
Oh, and to subscribe to multiple tags from one person you have to go to the page multiple times; it won't let you do multiple selections from the drop-down menu.
Actually, playing with it more, it looks like Email notification is separate from simply being notiifed, which confuses me. Oh, wait, Message Center. That's neat. You can have stuff show up there or in e-mail or both. [Edit2: Actually it looks like it'll show up on the Message Center page regardless; you can just choose whether you want it e-mailed in addition.]
Bets on how long it'll be before someone finds a way to track who's tracking you?