1. First unlock your bootloader if you have a T-mobile Nexus One (this voids the warranty) or get an unlocked version from Google for like $550:

a. download fastboot
b. open terminal or command line and type
– Windows fastboot-windows oem unlock
– Mac ./fastboot-mac oem unlock
– Linux ./fastboot-linux oem unlock

2. Rewrite the Bootloader to obtain root privileges:

a. Download either SuperBoot or InsecureBoot and extract. (The difference is that with the insecure boot you won’t make any changes to the system and you would have to launch su manually)
b. Put the device in bootloader mode:
– Turn off the phone and restart holding the trackball.
c. Flash the bootloader:
– Windows = double click the windows bat file
– Mac = open terminal and cd to the directory containing the file. type
chmod +x install-superboot-mac.sh
./install-superboot-mac.sh
– Linux = open terminal and cd to the directory containing the file. type
chmod +x install-superboot-linux.sh
./install-superboot-linux.sh

Now you should have root!

Pic courtesy of Stericson.