Right now, its only partially invisible in 2 dimensions and there is a slight shadow, but the researchers (from Duke Unviersity) said the ultimate goal is invisibility in 3 dimensions with no shadowing.
The basic idea, is that carefully constructed materials can bend light around itself, making it invisible. We see things when light bounces off the object and some of it reflects back to our eyes.
Anyway, check out this article, its pretty interesting.
I haven't read the article, but your description of this break-through certainly captures my attention! It's hard to imagine such a thing as possible...and in another way...very possible.
While other bloggers would have been content to include only one link to the article in their post, you boldly chose to link twice. I salute you sir.