iPhone Dev Team on Jan 1, 2009 released Yellowsn0w the much awaited iPhone 3G Free Unlocking Software which was easy to install but as usual with the Beta releases the first release was full of bugs and errors. Now the beta version of iPhone unlocker software Yellowsn0w has progressed to 0.9.6 and users are reporting that this version is working fine for them.
The Free iPhone Unlock Software works exclusively with baseband 02.28.00 which is provided by the latest iPhone firmware update 2.2.
To Install yellowsn0w use Cydia or Installer
For Cydia go to http://apt9.yellowsn0w.com/
For Installer go to http://i.yellowsn0w.com/
yellowsn0w is also completely removable through Cydia, the command line, and iTunes. If you happen to be using previous versions of yellowsn0w then you should upgrade to the recent version and report all bugs at iPhone Dev team website.
As this is a Beta release use the software at your own risk.
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