Sony Computer Entertainment announced the PlayStation 4 today at an event in New York City.
The event was live streamed, and during most of the presentation had more than 600,000 viewers.
The PlayStation 4 features an APU with a "powerful" x86 8-core CPU, and an "enhanced GPU", which will take on board most of the particle physics processing.
The new system will have 8GB RAM and a local hard drive.
The new DualShock 4 controller, which was leaked earlier this week, has a touch pad, a share button, a headphone jack, and a Move-like light bar which acts as a "simpler, more friendly" way to identify players.
System Architect Mark Cerny, speaking at the event, said users would be able to instantly share video of gameplay to social media through the PlayStation 4, using the DualShock 4's new Share button.
The controller can be tracked by a camera via the light bar.
No pricing or firm launch date was set for the PlayStation 4, but there was a launch window: the holiday period of 2013.
The console also didn't make an appearance at the showcase, although Sony did show off the new controller and new PlayStation Eye camera.
The PlayStation 4 will not be backwards compatible with PS3 games, but Sony announced several new games for the platform at the event. We've detailed some below and will update.
You can use remote play with PS Vita to play PS4 games, and the "work" is spread evenly across the PS4 and the Vita. This is done using local Wi-Fi.
Gamers will be able to start a game download and begin playing the game immediately while the rest of the game downloads.
Cerny said users would be able to turn the PlayStation 4 off, and immediately return to the same exact point in their game on booting it again.
PlayStation 4 will, as rumoured, be integrated with Gaikai's streaming games technology.
"What we're creating is the fastest, most powerful network for gaming in the world," said Gaikai chief executive Dave Perry.
The system will get to know your preferences and use that information to tailor your experience to you, and you will also be able to broadcast your game live online through Ustream. If you allow it, friends can post comments directly to your screen.
"Spectating has become very popular in our industry because it lets players learn tips and tricks from the best players in the world," Perry said.
Nate Fox, of Sucker Punch, announced a new InFamous game, InFamous: Second Son. The game is based on a 1984-like concept of a society under surveillance. It seems to feature a new protagonist called Nate.
Guerilla Games' Herman Hulst took the stage to show off the company's new Killzone game, called Killzone: Shadow Fall.
Hulst described the conflict in Shadowfall as similar to Cold War Berlin, with two opposing factions living side by side, separated by a wall.
A game called DriveClub was also announced by developer Evolution, who described it as "a very simple concept about driving the best cars in the world at the best locations in the world."
DriveClub needs to be played as a team against other clubs. The club will be accessible regardess of whether you're at your PS4 or not, via mobile devices.
There were games for the less-mainstream gamer, too: indie developer Jonathan Blow, who created Braid, took the stage to talk about his upcoming 3D puzzler, The Witness.
System architect Mark Cerny himself was working on a game with Japan Studio, called Knack.
But the most shocking game announcements were the ones that were likely to make Microsoft's collective jaw drop.
Bungie, the game developer behind exclusive Xbox series Halo, was on stage to present the company's newly announced online sci-fi shooter, Destiny.
And Blizzard's senior vice president of story and franchise development, Chris Metzen, said that Blizzard Entertainment's massively popular PC and Mac title Diablo III would be coming to PS4.