I've been receiving a lot of questions about the state of current jailbreaks, especially when it comes to the just released iOS 4.3 beta and the Verizon iPhone (demo models ran iOS 4.2.5). The jailbreak community is working on a jailbreak but they have stated it will not come out as long as iOS 4.3 is in beta. There's a good reason for this. Most jailbreakers already realize it's a cat and mouse game with Apple.
If one of the dev teams has an exploit, they don't want to burn it. If they release it now, Apple can patch it before the final release and it's of use to no one. Unlocker @MuscleNerd isn't planning on releasing an unlock until iOS 4.3 is official, and for good reason. Here's what he has to say -
Official iPhone unlock statement: no unlock will be released until after 4.2.5 or official 4.3 (whichever is last) is out
I can't imagine a general jailbreak tool being any different. No point burning exploits for no good reason. So on that front, just be patient. And as always, don't upgrade right away if you plan on jailbreaking.
Click through for a current list of firmwares and what your jailbreak options are under each firmware. We've also got some links handy after the break to walkthroughs explaining each method.
Please note that redsn0w is currently a tethered jailbreak. There is a redsn0w beta out that allows for an untethered jailbreak but it's still got issues. I personally recommend staying on 4.1 until an easier (less buggy) solution is available if you can.
Keep in mind you always need to check your device type against each of these methods to make sure it's compatible. Click through to the links for more detailed descriptions of each and what they can offer you. If you still have questions, make sure to check out the TiPb jailbreak forums.