The update follows the 5.1 update which was released in September with the ability to save multiple iTunes account and quickly switch between them, Shared Photo Streams and AirPlay. It isn't common for Apple to release consecutive updates so quickly, but it probably was a necessity with the new iTunes update.
The update is available for the Apple TV (2nd Gen) and Apple TV (3rd Gen) and can be downloaded by heading over to Settings > General > Update Software. You can also download the firmware files through the following links and manually apply the update using iTunes
The Apple TV 5.1.1 build 10A831 update has the following new features and improvements
- iTunes Up Next
Adds support for Up Next with iTunes 11 or iTunes Match. See upcoming songs when playing music on your Apple TV. Add new songs and edit what’s queued with your Remote or with the Remote app. - Stability and performance
Includes performance and stability improvements with the iTunes Store, AirPlay, Netflix, iTunes Match, and wired Ethernet connections.