Just to begin, I'd like to dispute the previous reviewer's assertion that Robert Angier (Hugh Jackman) is the hero of the piece, and Alfred Borden (Christian Bale) the villain. It is not as strightforward as that, and therein lies one of the film's strengths - both characters are extremely well developed (primarily, of course, thanks to Christopher Priest's superb novel) and finely acted by the leading duo, and events conspire to wrestle our sympathies between the two antagonists. Borden does initially appear to be portrayed as the villain, his careless actions causing a helpless Angier's life to crumble around him (he loses a loved one and his reputation). But as the plot progresses, we see Angier become twisted with obssession and revenge, his motives growing ever more suspect and really rather sinister. Borden, on the other hand, is a largely motiveless character (though certainly no less interesting for it), managing not to let his obsessive quest for the ultimate magic trick lead him to immoral behaviour.
Bale and Jackman are both on top form, and the supporting cast is strong (Scarlett Johansson struggles a little, apparently concentrating too hard on her English accent and forgetting to make us care about her character; Michael Caine is, as usual, faultless).
This is Nolan's best film since Memento. It doesn't quite pip his 2000 thriller, but it comes close. A lot of people will see the twist coming, and a few will think it is obvious... but in a way, that's the point. Like a magic trick, you're looking for some higher secret, but you're fooled only by its simplicity. And here's a simple fact: Chris Nolan is Britain's best director, and among the best in the business today.