The new 'live shape' status was added to Illustrator in CC 2015.1. It is in the same slot as the ellipse tool in previous versions however it is now 'live' and some new features have been added. To use the tool, go to the toolbar (or toolbox) panel and select the tool which is normally found beneath the rectangle tool. I would suggest also going to the window menu and selecting the transform panel which has all the key properties.
The first thing to notice after selecting the tool and dragging the ellipse is that as you hit a circle, two cross hairs will appear and disappear as the size of the shape changes - they will appear if the width and height are equal. If you hold down the shift key, you can create a circle but the smart guides will not appear. Once you have the shape, you can then manipulate it either via the bounding box etc or via the transform panel
There are a two sets of fields for the height and width as well as the ellipse height and width, they are not equal but they can be set to the same but only when the angle is not involved. As soon as you change the angle, the settings will be different. You can change the width etc via the up and down controls on the keyboard as well as just typing in the value or using the bounding box or the side points (to size proportionally use the left and right and use the top and bottom ones to squeeze or stretch up and down. You can change the angle (but if this is a circle then you won't see any difference). If you set the shear then it will break the live feature. You can re-position the path by using the selection tool but you can also use the center point of the path with the tool selected. You can also use the constrain buttons to size the width and height proportionally (either as a circle or as an ellipse)
You can now change the pie slice of the shape. You can use the transform panel to change the start and end angles but this can also be done interactively via the path itself by clicking the little extended line and dot on the path and you can then change the start and end independently. The pie slice is to the center of the path (which is a pity as it would be nice if the slice center could be changed as well). You can also invert the pie slice via the panel by clicking the invert pie button
You may or may not love the live feature as the tool does end up adding additional options that can sometimes get in the way of positioning the artwork (such as in the rectangle and the radius which always seems to flash up and block re-sizing the path). You can expand the live artwork by going to the object menu and shape and expand and you can then also re-convert it back again via the same menu. Once you have the normal path then you can use the sliced path (if the pie slice was used) in numerous ways such as creating all kinds of abstract backgrounds (see an example below). You can also create all kinds of other artwork using live effects such as the transform with the path (example below)
You can add all kinds of transformations and other effects to the artwork. Select and create a slice using the pie slice range 0 to 5 say and then go to the effects menu and transform commands and set the preview to ON (it is not sticky) and set the number of copies to 20 or 30 and then set the angle and rotation center as well as the move setting. You can use that to create a very quick burst / zoom effect. The transform effect will appear in the appearance panel. You can then change the setting by double clicking on the transform line. You can also add additional transforms such as only setting the number of copies and the scaling to create interesting radial artworks. The pie slice is still editable so you can create thin or thicker slices interactively as well as via the transform panel. You can also use other effects as well such as blurs and distortions as well as pathfinder etc
There is also a video tutorial about the subject on how to use the live shape tool in Illustrator [Youtube] showing the size features, transform, expand feature, pie slice etc
Nice addition to Illustrator and one I hope to see extended to the other tools such as polar grid etc as well as perhaps adding a ring feature / donut perhaps.