If BBEdit is a time-honored king among text editors, then TextWrangler is a worthy prince -- always a short step behind BBEdit in features, but also always (amazingly) free. If you're looking for a word processor (i.e., something to create pretty or specially formatted documents), look elsewhere. But if you need to edit, search, and transform text and HTML, TextWrangler is a well-oiled and efficiently designed machine.
TextWrangler 4 catches this app up with Mac OS X Lion with an updated interface and preferences, as well as features like full-screen mode. This update also brings in many of the cool new features of BBEdit 10, such as the iTunes-like document bar and more options for syntax coloring. (Note that TextWrangler 4 will only run on OS X 10.6 and later.) We get the more-robust search capabilities of recent versions of BBEdit, too, and you can even search inside compressed files.
As always, TextWrangler comes packed with tons of developer-specific tools across multiple programming languages, and developers will love the ability to make easy (and now even more streamlined) use of scripts (Automator, AppleScripts, and Unix), differencing and merging, text folding, and regex-based replacing. In fact, devs may love TextWrangler so much, they just might end up springing for the full package of BBEdit, with its more-advanced features and authoring capabilities. For everyone else, TextWrangler remains a powerful tool and a terrific value.