iOS 4.2.7 is also available now for CDMA iPhone 4 users on Verizon, alongside iOS 4.3.2 for GSM iPhone 4, iPad 2, iPad, iPod touch 3G/4G.
To update to iOS 4.2.7, all you need to do is to connect your iPhone 4 with your computer via USB and start iTunes 10.2.1. You should now see a message prompt. Simply click on “Download and Install” (Mac OS X) or “Download and Update” (Windows) button to get on to the new firmware 4.2.7.
The last major update for Verizon iPhone was iOS 4.2.6, released back in February 2011.