A “new” bug has been swirling around places like Slashdot, making it sound like Eclipse is broken. The bug is related to a change in the latest release of Java, v1.6.0_21, not Eclipse. It’s getting some attention because a lot of people are encountering it after accepting an automatic update to Java (particularly on Windows). It is a bug manifested in Eclipse by a change in the new Java runtime. It really goes back to an old bug (squashed in 3.3) where Eclipse couldn’t detect the Sun JVM; same bug now, because they’re changing the VM since Oracle’s sticking their name in everything. A note has been recently added to the permgen size FAQ page at Eclipse.org giving a little more detail than this.
It can be circumvented (or rather, postponed to the point of probably not happening) by increasing the garbage collection memory size by adding (or updating) the following two lines to your eclipse.ini file (on Windows and Linux, look right in the root of the Eclipse folder, for Mac, it’s deeper in the Library folders). If the settings aren’t there to be updated, add them just before the -vmargs, making sure not to split any other parameters.
You can choose a size larger than that if your machine supports it, or the delay until it runs out of memory isn’t enough. Always enter values in MB.
Alternatively (or additionally), you can specify the JVM to use by adding it’s path to the eclipse.ini file (again, before the -vmargs) to avoid the bug in the 1.6.0_21 runtime. This example uses the Java installed with the JDK instead of just the Java SE runtime that the path suggests.
Of course, your path may vary.