IPhone can't make calls, won't play voicemail

I bought my iPhone in September, and it has been great up until today. Now, the phone doesn't ring (or vibrate), and when I try to make a call, I hear no dial tone, and the call fails after nothing happens for about 50 seconds. I can't hear my voice mails that I am receiving. Obviously, I'm not aware of incoming calls. I am able to receive and read text messages.
I have version 1.1.4. Is there something I can do to remedy this or does the iPhone need to be repaired?
I have checked the settings, and everything appears to be on. However, I just tested the iPod, and while I get music out of the earpieces, I don't get anything out of the iPhone when I remove the earpieces.
Any suggestions?

This is a bug inherent to the iPhone. A sensor in the headset jack thinks there are headphones plugged in. A way to verify that is to try and increase/decrease the volume on the phone, and you should see the bell and earphone/headset displayed by the bell. Insert the headphones and remove them several times. That usually corrects the issue. If not, you can try a reset, but pressing and holding the home and sleep/wake buttons until you see the Apple logo, then releasing. That restarts the OS software.
Hope this helps you out.

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