iOS 4.2.1 had only been online for just a couple of hours before the Redsn0w 0.9.6b4 jailbreak was announced by ‘DevTeam’. This is not something unusual, except that they are always on time – whenever Apple have a new release announcement, ‘DevTeam’ are ready with their own announcement too, and this is the natural way of the iOS life.
Now ‘DevTeam’ announce that ‘Greenpois0n’ will be updated in a few days so that it will be possible for you to have your iOS 4.2.1 ‘jailbroken’. As of now they have developed a tethered jailbreak for all 4th generation based devices, but – they stressed this point in their post – ‘Comex’ is working hard on creating a ‘userland’ work-around to untether the latest iOS. They explain that a tethered jailbreak means that each time your device loses battery power or needs rebooting, it is necessary for you to attach the device to a PC or a Mac to boot it into the ‘jaibroken’ state.
Right now the jailbreak requires that you have your 4.1 SHSH blobs in order to enjoy it, and this is especially true even for firmware beyond 4.1.
Here is a link to a step-by-step guide. Enjoy.