Install limera1n from here.
Choose Windows (Assume that you are using Windows), Click Save to a location that you choose. Connect iPhone to your PC and run iTunes. Ensure that you sync your iPhone and also backup.
Follow the steps below after you complete the Backup.
Note: Remember that this backup will help you in case if anything happens during Jailbreaking, by restoring from this backup.
Installing Limera1n to jailbreak iPhone 4:
1. Launch the limera1n application and connect your iPhone to your PC and click “make it ra1n” button.
2. iPhone will now boot in to Recovery Mode automatically.
Hold HOME + POWER button when asked as shown below.
Release only the Power button when asked.
iPhone enters into DFU mode:
3. Done! iPhone is Jailbroken now.
Unplug your iPhone from PC and run “limera1n” application found on the iPhone. Follow the instruction shown.
Enjoy your jailbroken iPhone.