Untethered means you can reboot your iPhone/iPod Touch without having to connect it to your computer. Tethered means in order to reboot, you must connect it to your computer and run blackra1n.
When's the untethered jailbreak coming out: http://www.youtube.com/watch?v=8MCwx5Enm50
You're Untethered if you have an: iPhone 2G/3G/3GS (3GS with last digits of serial number not in the 40s) and iPod Touch 1G/2G
You're Tethered if you have an: iPhone 3GS (with last digits of serial number being in the 40s) and iPod Touch 3G
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