I recently switched to iTerm2 from the normal MacOSX Terminal. The main reason for the switch was the split window feature that I really needed in my Terminal (Emacs spoils everyone).  iTerm has some really nice features and is customizable. I used to use two screens on my Mac Mini and iTerm played well with that too.
I’ve been a great fan of Monokai the color theme since I bought a TextMate license in high school. I even ported it for Emacs when I switched from TextMate. There was no reason to not use it for iTerm, so I made the color theme for iTerm.

I’ve also made a few customizations to my .bash_profile  and.gitconfig  to neatly typeset information and take advantage of the beautiful colors.

[color]
        diff = auto
        status = auto
        branch = auto
        interactive = auto
        ui = true
        pager = true
[color "branch"]
        current = yellow reverse
        local = yellow
        remote = green
[color "diff"]
        meta = yellow
        frag = magenta
        old = red
        new = green
[color "status"]
        added = yellow
        changed = green
        untracked = cyan
[alias]
        tree = log --graph --pretty=oneline
        lg = log --color --graph --pretty=format:'%Cred%h%Creset -%C(yellow)%d%Creset %s %Cgreen(%cr) %C(bold blue)<%an>%Creset' --abbrev-commit

PS1="\n\n\n\n\033[01;32m\]user@machine \[\033[01;34m\]\w \[\033[0;31m\]\$(parse_git_branch)\n:> \[\033[0;33m\]"
PS2=':> '

 
I hope to port Monokai to the Crayon Syntax Highlighter and the Adium Terminal Message Style soon. Till then enjoy the iTerm2 theme.