Open your web browser of choice and navigate to http://www.limera1n.com. Click the Mac logo at the bottom of the screen.
When prompted save the download to your desktop.
Double click the limera1n.zip file from the desktop to extract the application, then double click to launch.
Connect your iPod to the computer and click the large make it ra1n button
You iPod will now be placed in recovery mode.
Press both the power and the home buttons.
When Limera1n asks you to, release the power button.
Your phone will now be in DFU mode
As limera1n performs its exploit you will see the image of a lime raindrop on your iPod.
Limera1n will let you know when it is complete.
After you power back on your iPod you will see a new icon on the SpringBoard entitled limera1n. Press it to continue.
Once Limera1n opens select Cydia then press the Install button at the top right of the screen.
Once the Cydia installation has completed you must reboot your iPod.
After your iPod has restarted you can run Cydia. Let it do all the necessary updates.
NOTE*: To remove the limera1n icon from your desktop you can relaunch the app and tap the Uninstall Limera1n button or install CyDelete from Cydia then use it to delete the application.
***A big thanks goes everyone who made this jailbreak possible.