"Love won't take no for an answer."
The Attorney General has announced the Justice Department's conclusion that Section 3 of the so-called Defense of Marriage Act (DOMA) is unconstitutional, so they will not defend it, but they will still enforce it. Well, actually, they concluded this as applied to same-sex couples who have legally married, so I suppose they could still defend it to refuse federal recognition to a lawfully entered plural marriage from some country that allows them. But this is huge news!
The U.S. Court of Appeals for the Second Circuit had not decided how deferentially or skeptically laws that discriminate on the basis of sexual orientation should be reviewed by courts under the constitutional guarantee of equal protection of the laws (the "level of scrutiny" issue). This, Attorney General Holder has explained in a letter to Congress (here and here for the AG's statement about the decision), led to a review of this question. Having decided that something more than minimal "rational basis" review is required, the Administration has concluded that DOMA Section 3 cannot meet heightened scrutiny. Interestingly, the letter relies on the Don't Ask, Don't Tell Repeal Act in support of its conclusion that sexual orientation discrimination warrants heightened equal protection scrutiny.
The letter does not explain why it stops short of calling for the type of strict scrutiny used for racial discrimination, instead applying the same kind of intermediate scrutiny used in sex discrimination cases; perhaps the answer is that the more deferential intermediate scrutiny (which they call "heightened") is sufficient to invalidate Section 3 as applied to legally married same-sex couples, so they did not have to decide whether the most skeptical standard (strict scrutiny) is required.
However, while the Administration has concluded that it will not defend DOMA Section 3 against heightened scrutiny, it will continue to enforce the measure while it is still on the books, "unless and until Congress repeals Section 3 or the judicial branch [read, the Supreme Court of the U.S.?] renders a definitive verdict against the law’s constitutionality."
[Edited to include sentence about Don't Ask, Don't Tell Repeal Act.]
[Edited to include link to Attorney General Holder's statement, not just the letter to Congress]