If you don't know how to install applications from Cydia, take a look here si here to learn. If you already know or have learned, let's start!
Use this tutorial only if you have a jailbroken iPhone 3G/3GS, if not go to the tutorial section to learn how to do this. Do not attempt to install ultrasn0w IF YOU HAVE BASEBAND 05.11.07 because it WILL NOT WORK!!! If you baseband 05.11.07 you must use blacksn0w to unlock your phone, installation can be done using one of these 2 tutorials to unlock your phone: Windows Mac.
Before starting, make sure that you are connected to a wireless or that the Internet works on your phone. If you are on a network that does not support 3G, then before starting uncheck 3G from Settings>General>Network.
Step 1
Open Cydia, go to source and add http://repo666.ultrasn0w.org.
Step 2
After adding the source, go to search and search for ultrasn0w and install it.
Step 3
After finishing the installation, press the button that tells you that the phone will restart and wait. If after the restart the phone does not find the network, try to put it in Airplange Mode and after 10 seconds take it out. If it still doesn't work, try a reset network settings from Settings>General>Reset>Reset network settings, now it should work.
If you encounter other problems that are not covered by this tutorial, please ask me using the support page located here.
