iphone-hacks.com

1st Method
1. enter *#307# press call, now use the back button on the top of your screen to remove *#307# , 
   now enter 0 , press call, press answer, press hold, press decline. And you get to the contact
   list. And thereafter every time you push the homebutton you just slide the "emergency call"
   slide, then enter 0 , press call, press hold, press decline.

2. Push contacts, end call and you get called again, this time hit decline and you access one of
   menus with favorites, you can edit contacts, do a test ride on keyboard, take photos etc.

3. Now edit a new contact and type in "prefs://11" as web-address and "http://jailbreakme.com" as
   an additional URL.

4. When you tap "prefs://11" you can now select your favorite WiFi gateway.

5. Now press the home button and move the slider to the dial-pad.

6. Now you can go back to the contact list by Dialing 0, push call, then answer, then contacts,
   then hit the "http://jailbreakme.com" web address you typed in.

7. Scroll down to the bottom, click "Install AppSnapp". Safari will exit and you'll return to your
   springboard. Wait for the phone to reboot. You are now jailbroken. and are able to use
   Installer.app.

2nd Method
   1.  At the activation screen, slide to make an emergency call;

   2. Dial *#301# — the phone will call itself;

   3. Answer and immediately tap "Hold";

   4. The phone will call itself again, hit "Decline";

   5. At the keypad, go to Contacts, add a new contact;

   6. Hit "Add new URL" and enter "prefs:" (without the quotes);

   7. Add another new URL, enter "jailbreakme.com";

   8. Save the contact and go to the first URL by tapping it;

   9. This opens the iPhone Settings, add an accessible Wi-Fi network;

  10. Also recommended: set General -> Auto-Lock -> Never;

  11. Press the Home button and slide for emergency call;

  12. Dial 0, answer, do steps 3 and 4 (Hold, then Decline);

  13. Browse to that contact you created and select the second URL, jailbreakme.com;

  14. Read, then install AppSnapp Installer;

  15. Wait... The phone should restart within 2 minutes.

Both methods are basically the same