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The Nikon Coolpix S500 features a 7.1 megapixel CCD image sensor and a Nikkor-branded 3x optical zoom lens. The Coolpix S500 couples this with the company's true optical VR (Vibration Reduction) technology as well. The S500 also includes a large 230,000 pixel 2.5 inch LCD screen, but like many compacts these days, has no optical viewfinder.

Nikon is also known for a few special features that are included in the Nikon S500, including D-Lighting (which enhances darker images to improve shadow detail), Best Shot Selector mode (which takes a series of shots, letting the camera automatically pick the sharpest shot and discard the others), Red-Eye Fix (which automatically finds red-eye in your images and eliminates it), and finally Face-Priority AF. This last feature will initially keep you and your friends dancing around in front of the S500 to watch it put a "focus box" around your faces, but once you get used to the mode, you'll find it very reassuring to know that your loved one's faces will indeed be in focus, before you take the shot.

The Nikon Coolpix S500 offers 26MB of built-in memory and includes a Secure Digital / MultiMediaCard slot that is also compatible with new SDHC cards, and includes both USB computer connectivity plus NTSC / PAL video output. The S500 draws power from a proprietary Lithium Ion battery.

The Nikon S500 ships from March 2007, priced at US$300.