To be completely honest, I have'nt listened to a lot of the more popular albums this year (Nick Cave, TV On The Radio, Viva La Vida), and I've really been meaning to.

Nick Cave's album is unimaginably overhyped on this board and elsewhere. I thought last year's Grinderman self-titled was much better.

Johnny Flynn - A Larum and Giraffes? Giraffes! - More Skin with Milk-Mouth certainly sounds Interesting. I'll check em out soon.

Anyways, I'll just name a few from an "experimental/prog" point of view -

Kayo Dot - Blue Lambency Downward - Most of their metal influences have vanished here, but this is quite weird, jazzy, avant-garde soundscape that keeps me captured throughout the entire thing. Yeah, I loved it :D.

Guapo - Elixirs - Guapo are a VERY hard band to describe. Basically, if anyone is familiar with Universe Zero, Magma, or even a bit of Henry Cow, they might have an hint from where these guys are coming from. Five Suns, their best release, is very unsettling, dark, atmospheric avant-garde music.(with some post-rockish ambiance as well)
They are just continuing the good work here, although not as dark, but still great atmospheric stuff that captures you!

The Tangent - Not as good as the book - A great prog. release that doesn't seem to have any bit of over instrumentation or bad vocals whatsoever. It doesn't sound like "just another prog. release" either. There's something refreshingly new here, which I'm not able to pinpoint.

From a metal/alternative rock point of view, there are a couple in mind as well, but I'll post em later.

Pilgrim Road by Willard Grant Conspiracy.

"Skeleton"- Abe Vigoda
An upbeat, catchy, experimental pop album that deserves more attention. The only downside is mediocre production quality.

"Animals"- This Town Needs Guns
A perfect hybrid of technicality and melodic sensibility. "Math pop", if you will.

And absolute win for G?G!, lucifer sam. It's great to see more people are discovering them, they're absolutely brilliant live and in studio.

Nick Cave's Lazarus is an excellent album, overhyped or otherwise (I personally believe it's received what it has deserved).

I think it is a pity that such little attention has gone to Blitzen Trapper - Furr. It's an excellent LP with not a single track of filler.

The Walkmen - You & Me, is an unbelievably good album which again, sadly, nobody cares about.

Erykah Badu - New Ameryka Part 1 is a really good album.

Flying Lotus - Los Angeles was a stellar release.

Oh, and if nobody has tried to bother with Of Montreal's Skeletal Lamping then I suggest they at least give it a go, because it's one hell of a lot better than a lot of plonkers are giving it credit for.

If You Like Rap / Hip-Hop...

Killer - Tech N9ne

Erykah Badu's album is sick.

@ Demonoid: Let me know what you think of 'A Larum'. No one else here seems to have mentioned it. I have yet to finish my review of it, but I have a thread in the New Releases Rating Forum. Leave your thoughts there!

Hey God, It's Me Alex. I Have Some Questions, and I Want Some God Damn Answers-Alexander T. Kent
A must if you can find it.

Well, two of the best metal albums of 2008:

NONONO by The Human Abstract
and
Fortress by Protest the Hero