Two security researchers, Charlie Miller and Collin Mulliner, have discovered a serious security vulnerability affecting SMS messaging on the iPhone that will be unveiled later today at the Black Hat security conference in Las Vegas. This flaw affects all iPhones and can allow an attacker to gain complete control of an iPhone, including the ability to make calls, browse the web and access the camera. This exploit is caused by corruption in the iPhone's memory handling and is executed by sending a burst of text messages by using a uncommon text character or by sending a hidden message.
So far, Apple has been rumored to have a fix in the works, but there's been no confirmation yet when it will be available. The researchers also say that there's nothing you can do to protect your iPhone from this vulnerability, other than to turn off the phone. More details on this issue will be discussed later today at Black Hat, hopefully outlining a path to fix this issue.
Meanwhile, the two developers have already demonstrated this flaw in action to CNET's Elinor Mills, proving its existence and extent of the threat.
We'll be providing more coverage on this issue once it's unveiled, so stay tuned to TUAW.