How Does The iPhone Airplane Mode Work?
Enabling Airplane Mode on the iPhone 4 will disable the following: cellular (voice/data), Wi-Fi, Bluetooth, GPS.
You can turn on Airplane Mode by clicking Settings and clicking Airplane Mode on. Once Airplane Mode is enabled you can selectively enable Wi-Fi and Bluetooth. To enable Wi-Fi, click on Settings->Wi-Fi, turn Wi-Fi on and select a wireless network. Or enable Bluetooth by tapping Settings->General->Bluetooth and turning Bluetooth on.