Scott Guthrie has announced on his blog entry, jQuery and Microsoft, jQuery library will ship as part of Visual Studio. jQuery JavaScript library will be distributed as-is, and without forking or changing the source from the main jQuery branch.  The files will continue to use and ship under the existing jQuery MIT license.

jQuery is a lightweight open-source JavaScript library that in a relatively short span of time has become one of the most popular libraries on the Web. A big part of the appeal of jQuery is that it allows you to elegantly (and efficiently) find and manipulate HTML elements with minimum lines of code.

jQuery will be incoporated into  ASP.NET AJAX Control Toolkit and ASP.NET MVC. Code will be distributed with intellisense-annotations that provide great Visual Studio intellisense and help-integration at design-time.

For more information, see John Resig's post on the jQuery team blog. Scott Hanselman wrote up a blog entry, jQuery to ship with ASP.NET MVC and Visual Studio, that shows how to integrate jQuery with ASP.NET AJAX and with ADO.NET Data Services.