INdependance, the highly popular jailbreak utility for iPhone, has been updated to include support for the firmware release whose name we dare not speak (1.1.1, there I said it).
Note Jailbreaking involves bypassing the iPhone's locked software, enabling installation of third party software, and should not be confused with the process of SIM unlocking. These are two different animals entirely.
Download it now, if you dare. Be afraid.