What features shall I look for to buy the best Digital Camera?

Consumer's Report says you only need more than 3 Megapixels if you plan on doing a lot of photos at 8x10 or larger. At 4x6 you can't tell a difference. Also the amount of zoom is important, battery life, and how fast the camera takes the picture. The most annoying thing about digital cameras is you shoot and then it takes so long for the picture to take. The only way you can compare is to go to a store and try them all out. Also when buying, check and make sure if it comes with a memory card or not. Otherwise you will be purchasing that separately.

The more megapixels, the better

Most important, in my opinion anyway, is the size of the CMOS sensor. If it's a true full 35mm frame sensor then you can use any regular 35mm lens you might currently own. If you look at the current Canon EOS 5d, it's a 12.3 megapixel FULL 35mm frame sensor. The Canon EOS 20d has a slightly smaller CMOS sensor and 8.3 megapixels. The reason this is important is that, while the smaller sensor is great for the job it does, a larger, full 35mm frame sensor is much less prone to distorting an image if you're NOT using a digital lens on the body. My opinion anyway.

Realistically, there are MANY things to consider. I've attached a few links below for your perusal. There's a whole lotta shakin' goin' on-- and a whole lotta good info in these here pages. :)

One thing not to worry about is digital zoom. Go for 3x or more optical zoom. Digital zoom just pixelizes your shots.

It depends on how much you can spend, what you will use the camera for and how much you know about photography, computers, and digital editing. The two best, unbiased places to go for advice are http://www.steves-digicams.com/ and select buyer's guide and http://www.dpreview.com/ and select buying guide in the left hand menu.

I agree with everything that the other answerers said so far.

I also want to add, that I look for the SLR form factor when buying a digital camera. I love being able to use regular camera lenses on my digital camera to enhance the optical zoom. You get extra zoom without reducing the quality much.

I have a Canon Digital Rebel series 6MegaPixel camera and totally love it. It takes great pictures and I can zoom in real far even with the basic lense that came with it. I bought some extra lithium batteries for it on ebay very cheaply so I can take pictures all day long for two days before running out of juice.

Your preference priority wise of course taking into consideration that u have prepared your self of the budget:
1) First and foremost - good battery back up.
2) How many pixel?
3) amount of Optical zoom (if compact camera)
4) Sensor size (mainly for dSLRs)
5) Up time and continuos frame shots (for fast photography)