From ModMyiFone - Wiki
Once again the Dev Team has done it, and broken into 1.1.1. This guide is simply made to help you follow their process.
IF YOU UNLOCKED YOUR 1.0.2 PHONE WITH IUNLOCK OR ANYSIM DO NOT FOLLOW THIS GUIDE. DO NOT UPDATE YOUR PHONE TO 1.1.1!!! IF YOU DO YOUR PHONE WILL BECOME A VERY FANCY IPOD THAT DOES NOT MAKE CALLS
Step One
You must be running 1.0.2 at the start. If you are running 1.1.1 and need to downgrade read here
Step Two
You also need to be running Installer learn to install here.
Step Three
Before you go any further you must have the 1.1.1 update downloaded via itunes. When your phone is plugged in and itunes is running hit the check for updates button. If it prompts you to download the 1.1.1 update download but DO NOT install it.
Step Four
Connect to iTunes. Your phone should be activated before this step whether through independence or activated by att.
Now hop onto your phone and go to http://conceitedsoftware.com/iphone/beta in the iPhone's browser.
Step Five
You will be prompted to add a community source to installer. Hit yes. You should now be in the installer screen. Hit refresh (bottom left corner) and the find Trip1Prepz and install. Great we are now ready to update to 1.1.1
Step Six
Go back into iTunes (IT should have been running this entire time). Your iTunes shouldn't look like this because your itunes should still be open from step 3. Hit Update
The normal update dialog boxes go by.
Step Seven
Download this archive and extract it on the desktop. The folder will be called "1". Run terminal and drag the 1 folder into it to switch directories.
Hit enter and your terminal session will look like below.
Step Eight
Now if you are running an intel mac type in
./iphuc-jailbreak.osx
If you are running a PPC mac type in
./iphuc-jailbreak.ppc
Now iPHUC is running
Step Nine
Type in
ls
Hit enter and you'll see the directory listing. Notice below that iTunes_Control is not listed. If it is in yours you failed jailbreaking and need to go back to the begining.
Step Ten
Type in
putjailbreak rdisk0s1 /dev/rdisk0s1
Hit return. Once the command line pops up again type in exit followed by enter to exit out of iPhuc. Restart your iPhone. Now we want to re run iPhuc.
Step Eleven
If you are running an intel mac type in
./iphuc-jailbreak.osx
If you are running a PPC mac type in
./iphuc-jailbreak.ppc
Followed by enter
Step Twelve
Type in
getfile /etc/fstab fstab
Hit enter. Now open up the "1" folder.
Double click fstab. You'll notice in the file it says "rw". If it says "ro" go back to step 10
Congrats, you have jailbroken your 1.1.1 phone. Now lets move on to getting ssh running.