Share my iPhone app for testing

Edit: I wrote this post a long time ago. Since then, services such as TestFlight have come along which do this entire process. This is really the way to go!

You need to make an ad hoc build which your friends can install on their phones. It's a bit of a pain, but basically, the procedure goes like this:

1. Go to the Apple Developer Center's Provisioning Portal and register their device ID's. You will need to have your friends give you their device ID's, which can be done by clicking on the "Serial Number" field in iTunes on the device page.
2. Generate a distribution certificate for ad hoc distribution in the Provisioning Portal under Provisioning -> Distribution
3. Download that certificate yourself (the .mobileprovision file) and install it into Xcode by dragging it on the Xcode icon.
4. Duplicate your "Release" build setting in Xcode for an Ad Hoc build. Everything should be the same as Release, except in the "Code Signing" section you will want to select the new Ad Hoc profile generated in step 3.
5. Make an Ad Hoc build by going to Build -> Build and Archive
6. When Xcode brings up the organizer window, right click on the archived build and make a .ipa file by saving it to disk
7. Tell your friends to drag the mobile provisioning profile to the iTunes icon (or with File -> Open for windows users) to install it on their phone.
8. Tell your friends to drag the .ipa file you made into iTunes, and sync their phones

At this point, the app should be installed on their phone, but lots of things can go wrong, so you should definitely read Apple's documentation on the subject as well.

Note that this procedure won't work unless your friends are using iTunes to sync applications with their phones. Also, as noted, you will need to be a paying developer in ADC to even access any of the Provisioning Portal stuff.

You need to create an ad-hoc provisioning profile and build your app with that. Then send both a .zip compressed build and the profile to your friends (maybe over e-mail). They don't necessarily need Macs... Windows will do just fine, as long as they have the latest iTunes installed.

There's more information (including how-tos) at the iOS Provisioning Portal.

All this assumes you've paid your $99 and are a registered iOS developer.