Lifehacker reported a new 3rd party application for jailbroken iPhone and iPod Touch. The software, known as iSlsk, can be used to as a limewire-like P2P file sharing client. It enables you to search for MP3s from its network and download it directly to your iPhone/iPod. It is combined with your iTunes library and allows you to playback. The only catch is the song will be wiped away upon your connection with desktop iTunes.
This software is definitely pushing the envelope of making iPhones truly independent portable computer solution. See a clip below of iSlsk in action: