Yes, there will be a new Xbox console next fall.
However,
the new console won't just be an Xbox 360 with a camera, though --
we've heard it will be considered a new platform and carry a new name
(Xbox Natal?). It's not clear what sort of upgrades we might see, but
some have suggested it will be an slight upgrade of the current Xbox
360 technology. Current Xbox 360 games would be playable on it, but
future games would be able to take advantage of the added muscle.
Similar to what we see in the PC space, games played on the more
advanced Xbox would look or perform better, but publishers will still
be able to support owners of both systems. Some developers have
complained that they've already maxed out the Xbox 360; perhaps this
will give them room to expand.