It is well known that hackers have found a way to use Microsoft's Xbox as a fully functioning personal computer to house movies and music, serve up Web pages and write software. Sony's PS2 and the earlier version of PSP that was released late last year in Japan have also been hacked.
How To Hack a PSP
The crack method requires two memory cards that are switched while the PSP is working. This must be done very fast! The hack also only works with version 1.5 "firmware."
Sony released version 1.51 of firmware on June 15th, which prevents the exploit. While this is bad news for hackers it also means that older versions of the handset are still exploitable unless the software is updated.
If you have made it this far and want to hack your PSP then here are the steps to the process... This is a swap hack and does require two memory cards! Here is a link to download the .rar file with everything needed. As Always TRY IT AT YOUR OWN RISK
Download Crack
Download any homebrew app/game
Load up the MSwap Tool
Select the EBOOT.PBP you wish to use
Select an Output directory
Click “Generate files”
You’re now left with two directories - MS1 and MS2
Copy the EBOOT.PBP from the MS1 directory to your first memory stick (MS) - X:\PSP\GAME\<SOME DIR>
Remove the first MS and insert the second
Copy the EBOOT.PBP from the MS2 directory into X:\PSP\GAME\<SAME DIR AS SPECIFIED ABOVE>”
Remove MS2 and insert MS1
Go to the Game menu on your PSP and select Memory Stick
Select the PSP-Dev Launcher
The moment PSP logo screen comes on, swap memory sticks
Vola! You’re playing homebrew on your 1.50 PSP!
This has been confirmed not to work on 1.51 and 1.52 PSP's.
Sources:
Technewsworld
PSP Hacks