Dell Home offers the Sharp AQUOS 42" 1080p Widescreen LED-Backlit LCD HD Television, model no. LC-42LE620UT, for $699. With free shipping, that's the lowest total price we could find by $265, outside of the mention below. Sales tax is added where applicable. Features include a 1920x1080 (1080p) native resolution, edge-lit LED backlighting, 6.5ms response time, 120Hz refresh rate, four HDMI inputs, and VGA, component, and other video inputs.
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Update: For its members, Sam's Club offers this HDTV for $648 with free shipping. That makes it the least-expensive Sharp 42" 120Hz LED-backlit LCD HDTV we've ever seen.
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