If you give a class to the placeholder on IE 8 and you drag something at even a moderate speed it loses track and stops your drag. The more complex your placeholder is the lower the speed is that you can successfully drag before it just decides to stop.

so something as simple as:

1. $("#sortlist").sortable({ placeholder: "ui-state-highlight" });

Will stop the sort on any sharp mouse moves, FF and IE < 8 don't have this problem. It seems to also be tied to the height of the placeholder. If you give it like a 100px height you can see to successfully drag you have to move even slower.

The problem exists on 1.7.2 and 1.8rc1 and it doesn't seem to matter which jquery core version.