Axis1.x and Axis2 have evolved from different architectures.
Speed - Axis2 is based on the StAX API, which gives greater speed than the SAX event based parsing used in Axis1.x.
Stability - Axis2 has fixed phases as well as user-defined phases for extensions. This allows far more stability as well as flexibility than Axis1.x.
Transport framework - Transports (i.e., senders and listeners for SOAP over various protocols such as HTTP, SMTP, etc.), have been abstracted away from the Axis2 engine. Having a transport-independent Axis engine allows far more flexibility in transport options.
WSDL 2.0 support - Axis2 supports both WSDL versions 1.1 and 2.0, which are used by Axis2's code generation tools to create web service skeletons and client stubs.
Component-oriented architecture - Axis2 components consist of handlers and modules in .mar and .aar archives. These easily reusable components allow extended functionality such as pattern processing for your applications or distribution to partners. Axis2 emphasizes the "Module" concept over the "Handler" concept of Axis 1.x. Modules contain handlers that are ordered by phase rules. These are attached to specific service(s).