The BlueJ site describes it like follows:
The BlueJ environment was developed as part of a university research project about teaching object-orientation to beginners. The system is being developed and maintained by a joint research group at Deakin University, Melbourne, Australia, and the University of Kent in Canterbury, UK. The project is supported by Sun Microsystems.
The aim of BlueJ is to provide an easy-to-use teaching environment for the Java language that facilitates the teaching of Java to first year students. Special emphasis has been placed on visualisation and interaction techniques to create a highly interactive environment that encourages experimentation and exploration.
BlueJ is based on the Blue system. Blue is an integrated teaching environment and language, developed at the University of Sydney and Monash University, Australia. BlueJ provides a Blue-like environment for the Java language.
I have started using this tool in my Java course as it is available for teaching Java. I believe my students will love this tool and will be able to learn OO concepts fast.
Tushar Joshi, Nagpur