* powerful branching model (named branches, bookmarks)
* straightforward conceptual model and philosophy, especially compared to Git
* simple and intuitive command-line interface – modular commands and easy-to-discover new features
* understandable and concise documentation (help command, man page)
* easy to learn and properly understand, for above reasons
* excellent hg-git bridge that allows pulling and pushing to Git repositories easily, as if they were Hg repositories (e.g. GitHub)
* helpful IRC channel and generally friendly user base
Mercurial is a very simple but powerful distributed source control manager. The most powerful feature is extensibility. There are tons of extensions and it's easy to write a new one, as Mercurial is written in python, a simple script can go a very long way. MQ (Mercurial queues) are a great way to keep work in progress. The command line makes a lot of sense and commands are very intuitive. There are great UI tools and it integrates with lots of software including the most popular IDEs.
In Mercurial common use cases are easy, more esoteric ones are possible, and the interface is a delight. Error messages are typically lucid. Command line help is useful, as are man pages and online tutorials. Mercurial is well-designed tool with a coherent user experience. (For the record, I have also used git extensively. Mercurial is much like git, but with fewer surprises and inscrutable messages.)