Great news, jailbreak fans: The latest beta version of iOS 5 (beta 3, which was released yesterday) can already be jailbroken using the iPhone Dev-Team’s redsn0w. While a previous version of the app didn’t quite work, the Dev-Team updated redsn0w (0.9.8b2) and the jailbreak now works perfectly.

Originally, @MuscleNerd announced in a Twitter update that “last month’s redns0w” should work with iOS 5 beta 3, provided users point the jailbreak tool towards the first beta version of Apple’s upcoming software update. However, after jailbreaking many iPhone owners encountered an unexpected issue with App Store applications: In short, this issue caused apps to crash or not run at all.

Fortunately, the iPhone Dev-Team was on hand with an update to redsn0w, which corrected this issue. As outlined over at the Dev-Team Blog:

We’ve update redsn0w to account for the sandbox changes that affected App Store apps in 5.0b3 (and it now recognizes the IPSWs for all three betas so far).  If you already jailbroke 5.0b3 using the previous redsn0w, you don’t need to re-jailbreak…just use this updated version to boot tethered.  Start pointing redsn0w at the 5.0b3 IPSW starting with 5.0b3.

To reiterate: If you already jailbroke iOS 5 beta 3 with the previous version of redsn0w, simply boot tethered with the updated version and the issue will be fixed. If you haven’t yet jailbroken under iOS 5 beta 3, just go ahead and use the new version of redsn0w. Furthermore, unlike previous versions of redsn0w, with this new version users must point the jailbreak tool at the iOS 5 beta 3 firmware file.

For more information (including download links), head over to the appropriate section of the Dev-Team Blog.