Steve Jobs, Apple's chief executive unveiled the touchscreen device at an event in San Francisco.
Mr Jobs described the tablet, which will cost between $499 and $829 in the US, as a "third category" between smartphones and laptops.
The device, which looks like a large iPhone, can be used to watch films, play games and browse the web.
The firm has also done a deal with publishers including Penguin, Macmillian and Harper Collins to allow e-books to be downloaded directly to the device through a new iBook Store.
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