Windows Phone 7 is "finally" jailbroken! ChevronWP7, the unlocker tool, works with every WP7 phone and allows for the side loading of apps, the use of private APIs, and access to low level functionality. Basically, it unleashes your WP7 phone.
It's easy to jailbreak too: just download the tool, connect your phone, and run through the unlock tool. It's straightforward, very low-risk and completely reversible.
As of now, there's not much benefit in jailbreaking a Windows Phone 7 device, but with some time, hard work and the right developers, it'll eventually mature into something awesome like the iPhone dev community, Android root users and even webOS homebrewers. [ChevronWP7 via WPCentral via IthinkDiff]