iPhone Dev Team member MuscleNerd has confirmed through twitter that he has got the untethered jailbreak to work on the iOS 4.2.1 and that they will be coming up soon with the untethered jailbreak for all disappointed iOS 4.2.1 jailbreakers. He has posted a video regarding this iOS 4.2.1 jailbreak on his youtube channel.

Untethered iOS 4.2.1 Jailbreak

Go through the video on Youtube ( Link ) as we are unable to post it here due to some technical reasons.

Stay tuned to Tips Needed for more updates on the topic!