We analyze the CP violating ratio \epe=epsilon'/epsilon in the Standard Model
in view of the new KTeV results. We review the present status of the most
important non-perturbative parameters B_6, B_8, B_K and of the strange quark
mass m_s. We also briefly discuss the issues of final state interactions and
renormalization scheme dependence. Updating the values of the CKM parameters,
of m_t and Lambda (MSbar) and using Gaussian errors for the experimental input
and flat distributions for the theoretical parameters we find \epe
substantially below the NA31 and KTeV data: \epe= (7.7^{+6.0}_{-3.5}) 10^{-4}
and \epe= (5.2^{+4.6}_{-2.7}) 10^{-4} in the NDR and HV renormalization schemes
respectively. A simple scanning of all input parameters gives on the other hand
1.05 10^{-4} < \epe < 28.8 10^{-4} and 0.26 10^{-4} < \epe < 22.0 10^{-4}
respectively. Analyzing the dependence on various parameters we find that only
for extreme values of B_6, B_8 and m_s and suitable values of CKM parameters
and Lambda(MSbar), the ratio \epe can be made consistent with data. We analyze
the impact of these data on the lower bounds for Im(V_{td}V_{ts}^*), Br(K_L to
pi^0 nu barnu), Br(K_L to pi^0e^+e^-)_{dir} and on tan(beta) in the Two Higgs
Doublet Model II.Comment: main latex-file, 4 figures and related latex files, 47 page