For people that have been wondering for some time now when Valve is going to upgrade the Source engine to support multi-core cpu’s (dual,quad etc). We can tell you they are upgrading the Source engine to be multi-threaded and all their existing HL2 engine based games will be upgraded to use it in the following months.

It will use two main threads: One thread will support the physics and game play and another will handle all of the graphics and 3d world affects. A dual core processor will really give you most of the advantage of this.

They do hope to get this completed by the end of the year though no date is fixed.

Talking DirectX10, the upcoming Source engine with Episode 2 and Team Fortress 2 will include the first instruction sets to support DX10.