From Technologist Community:

IIS7 represents the unification of ASP.NET and IIS. Let me clarify what that means. Right now, ASP.NET is implemented as an ISAPI extension for IIS. That will still be true in ASP.NET 2.0.

In IIS7, that changes. Instead, the concepts of HTTP pipelines, handlers, modules, XML config files, etc… are all natively built into the platform.

Along with that, the IIS7 team has completely refactored the whole platform, so now practically every feature in the pipeline has been broken out into a separate module.

From a security standpoint, this is a whole new realm for IIS.

Read more here.