Microsoft today took the wraps off the latest iteration of its Windows Phone 7 operating system (code named Mango), giving the public a first look at those 500 new features CEO Steve Ballmer promised yesterday during a talk he gave to developers in Japan.

Today’s announcement, which took place in New York City, was streamed live to Microsoft’s website.

While not all of Ballmer’s 500 features were displayed today, those that were shown defined the next step for a maturing operating system. The company stressed that it is working to make its patented front tiles smarter by integrating more services within the OS itself.

Services like Facebook, Twitter and LinkedIn, as well as more complex email and calendar management, were featured today.

Demonstrations during the presentation showcased “threads,” which will allow users to switch between text, Facebook chat and Windows Live Messenger within the same conversation.

Contacts on the phone can now be organized into groups or personalized Live Tiles to see the latest status updates right from the Start Screen and lets users quickly send a text, email or IM to the whole group. Additionally, Twitter and LinkedIn feeds are now integrated into contact cards, and Mango includes built-in Facebook check-ins and new face detection software that makes it easier to quickly tag photos and post to the Web.

Some more practical improvements to Windows Phone 7 include hands-free messaging, with built-in voice-to-text and text-to-voice support. Also, Mango features a more intelligent keyboard with predictive text.

Internet Explorer 9 also gets a remake within Mango. The browser now includes improved visual search. At one point during the demonstration, Senior Project Manager Derek Snyder scanned the cover of a Miley Cyrus biography and the device went directly to Amazon’s Kindle bookstore, allowing him to buy the book on the spot. 

Microsoft is leveraging its stores of information and smarts from its other software, including search. Developers looking to be discovered will be happy with a feature called App Connect. The feature connects apps to search results, deepening their integration with Windows Phone Hubs, including Music and Video and Pictures.

Mango will be featured on the first Nokia devices that run Windows Phone 7, as well as forthcoming devices from Samsung, ZTE, HTC, LG, Fujitsu and Acer. Microsoft said Mango will be released “later this fall,” in an over-the-air update. The developer SDK has gone live at the company’s developer website.

Check out the video below for a more in-depth look at Mango: