As ScottGu announed in his blog a month ago, Microsoft will be shipping jQuery (a lightweight open source JavaScript library) with Visual Studio going forward and extend Microsoft product support to jQuery later 2008. jQuery will be used to implement higher-level controls in the ASP.NET AJAX Control Toolkit, as well as to implement new Ajax server-side helper methods for ASP.NET MVC.

You can find a demo of an ASP.NET MVC application using jQuery at ChrisVandesteeg's site. You can also find a walkthrough of Adding ASP.NET AJAX Scripting to an MVC Project here.