Arizona on hold
Federal District Judge Susan Bolton ruled for the Justice Department in staying implementation of the most controversial features while allowing a few minor ones, such as blocking traffic when soliciting for a job and prohibiting municipalities from becoming "sanctuary cities" (a city that does not cooperate with the federal government in enforcing immigration laws). This is seen as a victory for opponents of the law, though the governor and supporters are appealing. Confusion now reigns in Arizona as to what the law is (see Arizona Republic article).
What the judge has signaled, notwithstanding that this is only a temporary halt to the law, is that she is inclined to accept the argument of the Justice Department that federal law preempts state law. She went so far as to concede that state and local laws would hinder and interfere with the enforcement of federal law. Such laws would also create an unfair burden on legal aliens who would always have to carry proof they are legally in the country (See New York Times article). So, for the moment, it still is only a civil offense to be undocumented in Arizona, not a crime.
The fight over the law is far from ended. The governor is immediately going to the 9th Federal Circuit Court of Appeals to overturn the injunction and allow the law to go into full effect. If that fails, the state will carry it to the Supreme Court.
While proponents are discouraged by this first round, they take solace in the conservative make-up of the higher courts. Still, a Robert's Supreme Court that divides so often 5-4 is not necessarily likely to overturn the decisions. Even conservative federals judges are jealous of the prerogatives of the federal government.