Rails 1.1 is officially out and DreamHost has already upgraded their installation.
More than 500 fixes, tweaks and features from over 100 contributors. Check out all the new features, from the blockbusters to the lesser known upgrades.
Some people reports problems, since 1.1 is not 100% backward compatible, but you should be able to either tie your Rails application to a specific version of the Rails Gems or download a copy of the 1.0 release for each of your applications.
Same problem happened to Site5 and TextDrive. Apparently DreamHost has currently rolled back to 1.0.
DreamHost has the full explanation of the problems yesterday in their blog.