Update: All good things must one day come to an end, and alas, it looks like Sony's just decided to issue a mandatory update to all PS3s that breaks this jailbreak method. Heartbreaking, I know.

If Sony's PS3 gaming system took a step backward in functionality when Sony disabled its ability to install Linux, it's just taken two steps forward again.

t4nav, a Senior Member of xda-developers, has just discovered a method to hack the PS3 using a Nexus One or a Desire! All you have to do is:

Download this

and place it's contents onto the root of your SD-card.

Then download my flashable boot.img

Place that on the root of your card, Reboot into recovery and flash the PS3-signed.zip

Reboot your phone.

Launch terminal emulator...

Then type the following...
#cd sdcard
#insmod psfreedom.ko
Now turn your PS3 off at the wall, and plug in your phone.
Turn the PS3 back on at the wall.
Press the PS3 power button followed by the eject key in quick succession...

In fact, you can even undo the jailbreak, which is certainly more than can be said of certain other forms of Android-related hacking.

To get back to normal...

Download this...

Go into recovery...
Enable USB-storage
Copy .zip
Flash .zip

So far, it's only been confirmed to work with the Nexus One and Desire, though we're sure that with proper attention from the dev community, the hack could be ported over to other devices, such as the EVO 4G or Droid X.

Source: xda-developers via PS3-hacks.com