The GNOME Shell handles the parts "around" the applications in GNOME. It replaces functions handled by the GNOME Panel and by the window manager in previous versions of GNOME.
It’s been about three weeks since work started on the GNOME Shell and recently Owen Taylor blogged about the status of the work. A lot of the first weeks has been taken up with infrastructure work - getting things building, adding new features to gobject-introspection and gjs, debugging problems with various graphics drivers. But some of the visual elements are beginning to come together as well.
Read the entire post here: http://blog.fishsoup.net/2008/11/22/gnome-shell-status/