iPhone Dev-team had announced about Project “Yellowsn0w” iPhone 3G soft Unlock tool and also posted Demo video of Yellowsn0w. As per promise by dev-team Yellowsn0w is now available for download on this New Year’s Eve (a bit late).

Yellowsn0wis the world’s first software unlock for the iPhone 3G. With yellowsn0w you can unlock your iPhone 3G firmware 2.2 and use it with any other carriers apart from AT&T. iPhone dev-team had warned to all iPhone users planning to jailbreak iPhone 3G firmware 2.2 not to upgrade to baseband 02.28.0 as Yellowsn0w will only work with iPhone 3G Firmware 2.2 with baseband 2.11.07.

But now you can safely ignore that warning as Dev-Team has managed to get yellowsn0w to work with iPhone 3G baseband 02.28.0, So no need to worry if you have already upgraded your iPhone 3G 2.2 with baseband 02.28

Recent updated message on this post, it’s clear that the soft unlock (yellowsn0w) will now be only for baseband 02.28.0 (the most recent baseband). Hence you need to upgrade and jailbreak your iPhone 3G with firmware 2.2 baseband 02.28.0 to use yellowsn0w.
How to Upgrade to iPhone 3G Firmware 2.2 with baseband 02.28.0

1. Download iPhone 3g Firmware 2.2

2. Jailbreak iPhone 3G Firmware 2.2 Using QuickPWN 2.2 and add Cydia/Installer.Quick Points About Yellowsn0w iPhone 3G Unlock soft Tool

- This unlock software works with the latest baseband only so jailbreak using QuickPWN or PwnageTool and upgrade to the latest version which is 02.28 BB.

- This application is launched on boot whenever there is a baseband reset and it’s small and unobtrusive.

- This application is a non-commercial application so it cannot be used by third-party companies or resold by anyone.
Download Yellosn0w to unlock iPhone 3G with baseband 02.28.0 from cydia/Installer Link

Cydia Repos:

http://apt9.yellowsn0w.com/

Installer sources:

http://i.yellowsn0w.com/

Please Note: The DevTeam says that once you are done installing yellowsn0w through Cydia go back to the main menu on Cydia and restart your iPhone with the 3rd party SIM installed. Wait for the slide to unlock screen, and then wait 10-15 seconds. If you don’t see your carrier name pop up you must remove your SIM, insert it again, and wait 10 seconds. (The DevTeam plans on elimintating this step)