Important***: You DO NOT QUALIFY for iOS5-to-iOS5 restores if you got to your current 5.x via an OTA (Over-the-Air) update.
Create a folder on your desktop called Pwnage
Download the latest version of RedSn0w from here and place it in the Pwnage folder. Likewise, download the firmware you would like to restore to and the firmware you are current on from here and place it/them in the Pwnage folder.
Extract the RedSn0w zip file to the Pwnage folder.
Right click or control-click the redsn0w application from the redsn0w folder we extracted earlier and choose Open from the popup menu that appears.
Click Extras from the main menu.
Click Even More from the Extras menu.
Click Restore from the Even More menu.
Click IPSW from the Restore menu, choose the IPSW you would like to restore to from the window that appears, and click Open.
Redsn0w will prompt you to connect your device. Do so, then click the Ok button.
If you need to point RedSn0w to another firmware ipsw it will ask you to do so. If you are re-restoring the same firmware version, RedSn0w will check Cydia to see if you have the correct blobs saved.
If RedSn0w is unable to find your blobs automatically you can try to click the Remote button to try again or you can click the Local button to search for blobs on your computer.
RedSn0w will place your device into recovery mode.
You may be asked to acknowledge that this procedure will update your Baseband. Click Yes to continue or No to stop.
RedSn0w will now restore your iPhone.
You'll be informed when your restore has completed successfully.
If you need help with this tutorial please post a question in the comments or submit a question to the iClarified community using our Answers section.