Well, it was only a matter of time. Until this weekend, Apple's security had thwarted attempted hackers of the iPhone 4, but that streak came to a close when JailbreakMe.com released the first iPhone 4 jailbreak. And it's remarkably easy to install.
[Warning: Although the jailbreak has been tested, it's not official Apple software and could muck up your iPhone 4. Not very likely, but it's important to put out there.]
Step 1: Sync your iPhone with iTunes and back up all your data in case you need to restore your phone.
Step 2: Using Safari on your phone, head to JailbreakMe.com.
Step 3: Follow the steps on the screen. It's as simple as that.
Currently JailBreakMe.com is experiencing a huge traffic load, but you can be sure that other sites will upload the necessary files soon enough.
The iPhone 4 jailbreak release comes after the US Library of Congress decreed that such "jailbreaks" are legal, as they encourage competition among software providers, instead of everything having to be funneled through Apple's approval process.
The current jailbreak is compatible with the following devices:
iPod 1G on 3.1.2
iPod 1G on 3.1.3
iPod 2G on 3.1.2
iPod 2G on 3.1.3
iPod 2G on 4.0
iPod 3G on 3.1.2
iPod 3G on 3.1.3
iPod 3G on 4.0
iPad on 3.2
iPad on 3.2.1
iPhone 3G on 3.1.2
iPhone 3G on 3.1.3
iPhone 3G on 4.0
iPhone 3G on 4.0.1
iPhone 3G[S] on 3.1.2
iPhone 3G[S] on 3.1.3
iPhone 3G[S] on 4.0
iPhone 3G[S] on 4.0.1
iPhone 4 on 4.0
iPhone 4 on 4.0.1