Another great new feature of the upcoming OS 4.0 is the ability to create Folders right from your iPhone. No longer will users have to jailbreak their iPhones and iPod Touches just for folder management (via Cydia app Categories). Sure, iTunes 9 did give us some control over app arrangement, but sorting apps and games into their own folders just makes much more sense.
To create a folder in 4.0, simply tap and hold an app until it jiggles. All you need to do next is drag that app on top of another and a folder will automagically be created. The OS will even rename the folder based on the categories of these apps/games, or you can simply create your own name. Folders can be dragged around on any springboard page and also be placed in the dock at the bottom of your screen. Currently, you’re only allowed to have 180 apps on your iPhone. With 4.0, over 2000 is possible thanks to folders.