Although often used for comical effect by white people to Express the general feeling that black people cause trouble and should be locked up(1), It was originally used as a heads up for white people that the offending nigs would not understand to avoid being terrorised by large crowds of nigs(2).
White Kid 1: "Heads up, Jail Break at 5 o'clock"
Kid 2: "Shit!, i'll throw a Banana in an opposite direction, that should distract them for a few hours"
guy: screw that, I'm waiting for someone to jailbreak the new patch so I can run my games
Commonly used to refer to enabling a carrier-locked phone, such as the iPhone, to accept SIM cards from other carriers. Or a restricted platform to run unlicensed or homebrew software.