That's a question that a lot of people are asking. And actually if you're a normal user there are only 3 real choices that you should choose from.
Home Premium, Professional and Ultimate.
You should get Windows 7 Home Premium if you are going to put it on a PC that's more for personal use. Basically if you have no idea what an Active Directory Domain is. This is the one you should get.
You should get Windows 7 Professional if you need the PC to join a Domain, as well as some other business related features like backing up to a network source instead of just an attached harddrive, the ability to use BitLocker to secure your hard drive, etc. etc. Windows 7 Professional also gives you access to Windows XP Mode if that's something that you need.
You should get Windows 7 ULTIMATE if you need access to some extra features that you can't find in the other editions such as Running Windows from a Virtual Hard Disk File or VHD (While this is a nifty feature which allows you to do nifty things like this, it's really a niche feature that not many users will benefit or have a use for), run the Windows UI in 35 other languages. (This is not the same as being able to input languages other than English as mentioned here, what's being refered to here is the ability to change the OPERATING LANGUAGE of Windows to the other languages, ie. You'd want to be able to see the Start button, Control Panel labels, etc. etc. in other languages such as Chinese, Japanese, Korean. Again... this is a nifty feature but I can't see a majority of users having a need for it)
There is one feature that I do believe would be quite useful to people but is only included in Windows 7 Ultimate is the ability to CREATE Bitlocker To Go devices. While any other edition of Windows 7 is able to read and write from a Bitlocker To Go encrypted drive, only Ultimate is able to create it. And I do feel that this was a bad decision on Microsoft's part.
Now you might be asking, what about the other editions you've been hearing from on the internet, namely the Starter, Home Basic and Enterprise editions.
I'll start off with the easy one. As an individual user, you will not and should not make a choice to get Windows 7 Enterprise, it's not meant for you. Enterprise edition has features that allows it to be tweaked and managed in an organization. If for some reason you obtain and install Enterprise edition, you might find it interesting how some things don't work the way they do in the other editions. So... as an individual user, DON'T BUY ENTERPRISE (you're not actually supposed to be able to buy it off the shelf anyway) BUY ULTIMATE instead.
You can't actually buy Starter edition off the shelf, and most likely if you were looking for it you'll be given so called OEM copies instead. Starter edition is meant to be preinstalled with low cost netbooks, it lacks a lot of the eye candy and advanced media features. And has what some would say the most errr... interesting feature of all... You can't change the desktop wallpaper... There's NO REASON NOT TO BUY A NETBOOK WITH STARTER EDITION installed, it's still Windows 7, you can still run all your PC applications, play all your games (If they can work on the specs of a netbook), and do all your work. IT BASICALLY WORKS. Just without a lot of eye candy. But.. you should NEVER BUY STARTER EDITION ON IT'S OWN. (Again... you're not supposed to be able to)
And as for Home Basic.... This is the complicated one. It definitely has more features than Starter (you can change the desktop wallpaper!) has more eye candy as well, but not as much as Home Premium. It's true that for most users, Home Basic will be sufficient for them. The complicated part is that... I have no idea wheter or not Home Basic will be available as a retail product here in Malaysia. Home Basic is marked as a product for emerging markets, and Malaysia is definitely on the list. But the last product to be labeled as such (Windows Vista Started Edition... don't worry about the name) Was not available for retail purchase, and only came preinstalled on systems. If you could find it on sale as a retail product, and you're just buying it for use on a PC that would be used by a casual user. Home Basic could work out for you.
Hopefully this clears up the which edition to get question for the people out there. Oh.. and if you want to see a list of features, here's one.