Overclocking is defined by Wikipedia as
the process of running a computer component at a higher clock rate (more clock cycles per second) than it was designed for or was specified by the manufacturer, usually practiced by enthusiasts seeking an increase in the performance of their computers.Now this same concept can be applied to your jailbroken iPod touch or iPhone. This process will allow you to increase the amount of free ram your device has by using the flash memory that is intended for music, video, and apps and turning it into extra virtual memory.
This virtual memory can be used by your device to perform normal functions while you play games and listen to music and have a movie downloading in the background with extra memory to spare. So lets get started!
1. Make sure you are jailbroken. (How do I do that?) And that you are on or at an above firmware of 3.0. (How do I check?)
2. Open Cydia then, in the bottom right corner tap on the Manage tab.
3. Tap on Sources then in the top right corner tap on Edit, then Add.
4. Type in http://repo.beyouriphone.com and press Add Source.
5. Once it's done, in the bottom right corner, tap on the Search tab.
6. Type in iPhoneVM 2 (OS 3.X) and tap on it.
7. Install iPhoneVM 2 (OS 3.X) to your device.
There you have it, once you restart your device, you will have much more RAM to use for more functions.
Please note that over-usage of this feature (running more than 7-8 memory intensive apps at once) may reduce the performance of your device over a period of time (a few years).