David Souter plans to retire this June, which gives Obama his first chance to appoint a new US supreme court justice. Souter was appointed by Bush Sr in 1990, but often disappointed Republicans with voting liberal. There is currently an even split of conservative and liberal justices with just one swing vote.
It is expected that Obama will select a woman. Possible candidates are solicitor general Elana Kagan, Stanford law professor Kathleen Sullivan, Michigan governor Jennifer Granholm, and appeals court judges Sonia Sotomayor and Kim McLane Wardlaw. Obama's selection will likely be challenged by the Senate who historically are tough in vetting supreme justice candidates.