URGENT: How to connect iPhone to internet over ad-hoc wi-fi network from MacBook?

I need to access the internet over wi-fi on my iPhone, but there is no wi-fi network I can use, so I am creating one with my MacBook. I choose "Create Network…" from the Airport menu on my Macbook, and I am able to connect my iPhone to the ad-hoc network I have  made, but I can't access the internet with it, for some reason.
I think this might have something to do with one of the following two things, but I'm not sure:
1.) In system prefs > network on my Macbook, it says:
"Wi-Fi has the self-assigned IP address 169.254.83.143 and will not be able to connect to the Internet."
2.) Also in system prefs > network, under 802.1X, it says: "Authentication server is not responding".
Any help will be deeply appreciated.

To add more, when looking at the network (you have to be on it or near it) in your list, click the blue arrow next to it to get the settings for that network. On that screen you can tell it to forget.

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