Unless you're a serious graphic designer or photographer then Elements should suit you fine.
Some of the features in Photoshop that are not included in Elements are (courtesy of cut and paste!):
CMYK and LAB color modes
Channels Palette
Recording Actions (for batch processing)
Adjustments: Curves, Color Balance, Match Color
Layer Masks, Layer Comps, and Quick Mask mode
Extract Filter, Lens Blur Filter
Color Replacement tool
Pen tool and paths palette
Some adjustment layers (curves, color balance, selective color, channel mixer)
Editing History Log
Text on a Path
Advanced Layer Style manipulation
Advanced Color Management
Advanced Web features and ImageReady (rollovers, slicing)
It's also interesting to note that the Mac version doesn't contain the Image Catalogue feature, conceding defeat to iPhoto.