iPhone dev team has updated Ultrasn0w to version 1.2.7 that can be used to unlock iPhone 3GS and iPhone 4 on iOS 5.1.1. No new basebands added. If you have been facing problems in unlocking your iPhone on 5.1.1, you can now get over those problems.
Simply go to Cydia and install Ultrasn0w to unlock your iPhone on iOS 5.1.1. This will also fix no service issue that some users have been facing ever since the release of iOS 5.1.1.