Microsoft Windows Phone 7 got its own taste of jailbreak and unlock from developer Rafael Rivera. The tool ChevronWP7 can jailbreak and unlock your WP7 phone with almost a one button interface.
The main benefit of jailbreaking your WP7 handset is the liberty to install applications without any Windows Marketplace.
Here is how you can jailbreak Windows Phone 7 using ChevronWP7:
Step 1: Install the latest version of Zune desktop software for Windows. Click here to Download.
Step 2: Download and install the latest version of Windows Phone SDK, or you can download the registery key from the following link and run it with administrative rights. Click here to download the registry key.
Step 3: Now connect your WP7 phone with your PC via USB.
Step 4: Run the Zune application on your PC and sync your Windows Phone 7 phone. Make sure the phone has a “full sync” access, and not “guest” relationship with the Zune
Step 5: Run the ChevronWp7 jailbreak tool. Click here to download ChevronWp7 jailbreak tool for WP7.
Step 6: Check “Ensure your phone isn’t PIN-locked” and “Install certificate on phone using Internet Explorer at http://chevronwp7.com/cert” options, and then click on the “Unlock” button.
The process is over and you can now install any third party Windows Phone 7 app without requiring a Marketplace development account.