Once you've decided on a camera type, the next thing you need to look at is resolution. Resolution is important because it tells you how large an image you'll be able to print. You can now find point-and-shoot digital cameras from 1-megapixel to more than 10-megapixels (and digital SLR's come in even greater resolutions). Here's a big thing to keep in mind: more pixels isn't necessarily better.
Seriously.
An 8-megapixel camera will allow you to print a 16x20-inch image – most of us have no need to print an image that size (and we probably don't have a printer that can do it, either). A 5-megapixel camera will do fine for most users - it will allow you to print an 8x10-inch photo with all details still intact. If you're only shooting photos to post on the web, however, a 2- to 3-megapixel camera should be fine for you.
Since a 2-megapixel camera can reliably print a 4x6-inch photo, it makes sense to consider what you'll use the camera for before buying an 8-megapixel monster camera. Paying for pixels you don't need is a waste of money.