The release of pfSense 1.2 has been delayed which has been caused by a number of minor issues. The developers want 1.2 to be the beste release ever, hence their concentrating on (potential) bugs.
1.2-RC4 can be expected some time in the next couple of weeks and then final tests for a week or so, followed with the final release. So if all goes well, 1.2 should be released around the 3rd week of January.
Source: pfSense blog (29/12/2007)