Your Nexus One is a developer model, and doesn;t need to be rooted. Instead we can unlock the bootloader and flash any firmware we want on the phone. Methods that try to circumvent this in order to cheat HTC (because YOU voided your warranty) aren't going to be discussed, because those that use them make it harder to justify unlocked phones, and in turn make things harder on those of us who enjoy them. Post any of them, or any discussion of them in this thread, and I'll delete them 
By editandroid.blogspot.com
You'll need the Android SDK installed. Follow Google's directions, and sing out if you need any help.
You'll also need Fastboot. Get it for your platform from HTC right here. Place the fastboot application in your SDK/platform-tools folder.
If you use Windows or a Mac, download and install PDAnet to your PC right here. This makes sure you have a USB driver that works in fastboot, and is the easiest way to do it.
Enable USB debugging on your phone (menu>settings>applications>development).
Next, power off your phone and hook it up to your computer. Hold the trackball, and press power to boot into fastboot mode.
Once your phone powers up, open a command prompt and navigate to your SDK/platform-tools folder. At the prompt type Choose YES to unlock your phone and void your warranty, and you're done. At this point you can install a custom recovery and/or a custom ROM with root enabled.
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