As we all may or may not know, Minecraft has released 1.2.4, with some new features added.
These new features have now caused a few changes:
1) 1.2.4 servers can only accept 1.2.4 clients, meaning that you cannot use an older client.
2) Bukkit has not released a build at this time for 1.2.4, so the only 1.2.4 servers are vanilla. I will keep you updated to when a new build is out for 1.2.4 They have released their dev here: http://dl.bukkit.org/latest-dev/craftbukkit.jar
3) To update your server, just download the new jar, whether it is vanilla or Bukkit, rename it to match what your current jar is, then replace the jars.