Hands on: Panasonic Lumix DMC-GX1

The Panasonic Lumix DMC-GX1 is the company's latest compact system camera, and its most refined and elegant to date. It's officially unveiled today, but last week we were ushered into an unmarked vehicle, taken to a secret location and given a chance to get hands-on with a pre-production model.

Panasonic dropped hints that this camera was on its way a few months ago, which we discussed in our review of the Sony NEX-C3 . The reality doesn't disappoint. Its slim body and lack of an electronic viewfinder mean its closest sibling is the Panasonic Lumix DMC-GF3 , but various features make it more of a successor to the enthusiast-oriented GF1 than the point-and-shoot GF3.

There's an accessory shoe for a flashgun or the new optional LVF2 viewfinder, a textured handgrip, a mode dial and many more buttons than on the GF3, including dedicated AE/AF lock and AF/MF buttons. The body feels substantial and the metal buttons add to the high-quality appearance, although we found the etched labels tricky to read.

The 16-megapixel sensor is the same one that appears in the G3, which means not only more detail but also less noise than the GF3's 12-megapixel sensor. Our test shots confirmed impressively low noise at ISO 3200, and even the top ISO 12800 setting was good enough for sharing online. Brightly lit shots at ISO 160 were packed with crisp, smooth detail. We didn't see any of the colour banding issues on skin tones that we've seen from other Lumix G cameras' JPEG output, although it's too early to say for sure. Image quality from our pre-production unit may not be indicative of the final product, but it's all looking pretty positive from our small batch of test shots.

With the same sensor as the G3, image quality isn't a surprise but does still impress - click to enlarge

Video quality in our preliminary tests was as good as we've come to expect from a Lumix G camera, and we're happy to see that Panasonic has returned to using a stereo microphone after the GF3's mono mic. We had the chance to compare its videos side by side with the excellent Nikon J1 in low light and we struggled to pick a winner. However, unlike the J1, the GX1 offers no control over video exposures other than exposure compensation – even the AE lock button stopped working once recording commenced. Video autofocus was smooth and quick but the J1 was substantially quicker. Again, the final production model may improve on this.

Panasonic put on fireworks for us to photograph, though we don't have any comparison shots on file, the results speak for themselves we think - click to enlarge