Flickr user Thane Plambeck captured a shot of Steve Jobs using a test iPhone in the wild:

According to Thane, "Yes, the photo is for real, and yes it is an iPhone that he was talking on, or at least it was the same size and shape. He took it out of his pocket to make calls using the touchscreen." He adds, "It's not like this isn't public information that they're developing the iPhone, and I wasn't surprised to see him using one (presumably they're testing prototypes or something). I just thought it was kind of cool that he was using one." As Thane says, not really surprising, but cool nonetheless.