Step 1: Downgrade to 1.1.1 (if required)
1. Download the iPod touch 1.1.1 ipsw firmware file from Apple. Do this in Firefox/Internet Explorer . Click the 'Save file' option.
2. Connect your iPod touch to your PC or Mac.
3. Put your iPod touch into restore mode: - first, turn off the ipod (slide to power off). - second, turn it back on but when the apple logo appears, hold down the home button until it shows the "connect to itunes" picture. Now your ipod is in recovery mode Next, press and hold the Shift key on Windows or the Option key on Mac (In iTunes), then click Restore in iTunes. It will open up the File dialog. Now you can select the 1.1.1 firmware file you downloaded earlier.
Note: Currently Itunes versions 7.4 and up will install ipod touch operation software 1.1.1
Step 2: Jailbreaking 1.1.1 (if required)
This step can be skipped for phones which are already Jailbroken.
1. Launch Safari on your iPod Touch.
2. Visit http://ipodtouchproguides.webs.com/, Scroll down and click "Jailbreak 1.1.1". Safari will exit and you'll return to your springboard. Slide to unlock, you are now jailbroken and are able to use Installer.app.
Step 3: Preparing 1.1.1 for the 1.1.2 update
1. Launch Installer.app, click on the Install section at the bottom.
2. Scroll down to All Packages and install "Community Sources".
3. Waitt for the sources to refresh and then go to All packages again in Installer.
4. Select OktoPrep
5. Click Install and wait until its done.
1. Connect your device to your computer
2. Launch iTunes
3. Choose your device
4. Click Update. Do NOT click on restore. If you do, everything you have done up until this point will have to be repeated.
5. Wait for your device to update. After the update you will see the screen before jailbreaking -without icon Installer. That's ok.
1. Eject your device from iTunes but keep it connected to your computer
2. Close iTunes
3. Download and extract the 1.1.2 Jailbreak Utility. Extract it to /tmp/ if you are using a Mac.
4. On Windows make sure you have Java installed then double click on windows.bat, on a Mac, double click on jailbreak.jar
5. Follow the on screen instructions.
6. Congratulations! You've jailbroken 1.1.2!