The Subversion team has been making steady improvements to
some of Subversion’s most criticized features, namely branching and
merging. With the release of 1.7 Subversion finally takes
care of all those darn .svn directories:
A key feature of the changes introduced in Subversion 1.7 is the centralization of working copy metadata storage into a single location. Instead of a .svn directory in every directory in the working copy, Subversion 1.7 working copies have just one .svn directory–in the root of the working copy. This directory includes (among other things) an SQLite-backed database which contains all of the metadata Subversion needs for that working copy.
Besides the release notes, Jessica Thornsby’s Top New Features in 1.7 article is a great place to get information along with her What’s New video.