A few days ago, @pod2g gave the untether to both the iPhone devteam and the chronic devteam. We’ve put it into redsn0w 0.9.10 and PwnageTool, and the chronic devteam put it into a Cydia package (the same set of exploits is in all three).
Detailed instructions are available on each respective site. The new jailbreak is only available to devices prior to the iPad 2 and iPhone 4S which both use the A5 processor. Jailbreaks for those devices are still pending.
This is also the first "untethered" 5.0.1 jailbreak which allows the jailbreak to remain active without having to reconnect to a computer upon reboot.