LimeRa1n: How to Jailbreak your iPhone 4, iPhone 3GS, iPhone 3G, iPod Touch 4G and iPod Touch 3G

This a step by step guide and tutorial on how to use LimeRa1n to jailbreak your iPhone iOS 4.1. LimeRa1n will jailbreak the iPhone 3GS, and iPhone 4. It will also jailbreak the iPod Touch 3G and iPod Touch 4G. As usual, proceed at your own risk.
Step 1: Download LimeRa1n and run it as administrator.
Step 2: Connect your iPhone to your computer and launch LimeRa1n then click “Make it Ra1n”.
 
Step 3: Follow the onscreen instructions: hold the Home and Power button together.

Step 4: Release the Power button.

Step 5: LimeRa1n will then put your iPhone into DFU mode and will then work its jailbreak magic.

Step 6: Your iPhone is almost jailbroken and you should see the following messages.

Step 7: If you don’t see the LimeRa1n icon on your iPhone, simply reboot it, then launch LimeRa1n on your iPhone and select Cydia to install.

Step 8: Once Cydia is installed, you can then uninstall LimeRa1n using the LimeRa1n app on your iPhone.
That is it!