Something that's state of the art is the most modern, updated version. Your state of the art wristwatch might double as a cell phone.
A state of the art computer system uses the most recently developed features, and a state of the art hospital has every modern amenity and follows all the latest rules of hygiene. You might choose a state of the art school rather than one that's smaller and more charming but doesn't have the latest technology. The phrase state of the art was first used as a noun in the early 20th century, and as an adjective around 1960.