Sim Card not recognised carrier help!!!!

I have an iPhone from Apple as a replacement for my o2 iphone 3GS as there was an error with the silent button.
I was using it fine and then yesterday I turned the phone on and found the connect to itunes logo.
After connecting to itunes it is telling me that my sim card is not an official carrier for that phone???
Any help would be greatly appreciated!
As you could imagine i'm very confused.
Cheers

Thanks for the reply, I'm in the UK but my only mind boggle is that I was able to walk out of the Apple store 3weeks ago after a member of staff swapped the sim cards for me with an iPhone working on the O2 network but suddenly wake up to an iPhone that will now only accept orange???
How can this happen? Surely I need to get it back to apple in London?

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