A worthy successor to last year’s E-300, the E-500 Digital SLR from Olympus brings with it a welcome selection of new features, while maintaining compatibility with the existing range of Four Thirds lenses and accessories.

In our last round up of digital SLR cameras, Olympus’s E-300 was considerably older than the competition and starting to show its age. The new E-500 is lighter and has a larger, higher-resolution LCD panel.

The E-300’s unusual sideways viewfinder gave the camera body a rather strange low-rise appearance, but the E-500 makes a return to a more conventional and yet still highly compact body-shape.

At 435g (without the lens), it’s a whole 145g lighter than the E-300 and is comfortable to hold.

It also packs in a larger 2.5in LCD panel with an increase in resolution from 134,000 to 215,250 pixels.

This is a welcome upgrade, not only for the increased clarity in image playback but because it’s home to a vastly improved status display.

The E-500 doesn’t have a separate, top-mounted LCD status panel so all shooting parameter information must be displayed on the main LCD. Although this uses more battery power, it saves a great deal of space on the body.

The status shows a large amount of information in a clear, illuminated format. More impressive is that, by pressing the OK button and cursor keys, you can use this display to edit the camera settings directly - much faster than using the camera’s menu system.

All the major shooting options are laid out before you, making adjustments almost as fast as having dedicated control buttons.

A new manual focus-bracketing feature allows you to use manual focus with confidence - the camera will automatically take up to seven extra shots with slight adjustments in focus either side of your selected focus point.

Exposure, white balance and flash power bracketing are also provided.

Also new is the ability to process raw images directly in the camera. By selecting the edit mode you can convert raw files to tiff or jpeg using the currently selected camera settings (the settings can be different from those selected at the time of shooting).

You can also post-process jpeg or tiff files into black and white or sepia, as well as reduce red-eye effects and perform colour and size adjustments - all without the use of a computer.

Like the E-300 model, the E-500 has a built-in dust control system, and Olympus is very keen to make sure you notice it.

An ultrasonic filter is activated every time the camera is turned on and accompanied by a short animated display on the LCD panel and a flashing blue LED on the top of the camera.

Although the inclusion of a dust control system on an SLR is laudable, it does cause a noticeable delay to shooting.

The E-500 retains the same 8megapixel resolution of its predecessor and achieves image quality that’s similar or, in many cases, better.

The added control and bracketing functions also serve to improve your results which stand up very well when compared to other budget SLRs.

At the time of writing, you can buy the E-500 together with a 17.5-45mm lens at Dixons for only £499, which is an excellent price for a quality digital SLR kit.

Olympus is currently stating an estimated retail price of £600 for the same lens kit.