Downloads: Blackra1n

This will jailbreak 1G, 2G, and 3G iPhones and iPod Touch versions 3.1.2.

Installation:

1. Connect the iPhone or iPod Touch to iTunes
2. Execute blackra1n.exe
3. Click "make it ra1n"

After it restarts you will have a new icon called blackra1n. Click it and install Cydia. Rock cost money so don't install it. Afterwards click the red button next to uninstall blackra1n and uninstall it. This just removed the installation files and not the jailbreak itself.

NOTE: The 3G iPod Touch is tethered. This means that if you turn your iPod Off or it dies, you will need to execute blackra1n.exe again in order to boot back up. So simply just press the lock button once instead of holding it and turning the device off.

Full Tutorial: http://www.consolediscussions.com/fo...re-3-1-t23872/