1. You've discovered/realized your cell phone has been submerged in water. Regardless of how long it was underneath you should follow the same procedure. Firstly, remove the phone and try to get all excess water off with a cloth.
2. Immediately remove all removable parts including: phone battery, SIM card, and any other easily removable parts. Do not go to great lengths to remove covers or circuit boards that were never meant for your removal.
3. At this point you may wish re-submerge the phone in distilled water. Chances are you don't have the stuff lying aroud the house. Any drugstore should carry distilled water. Distilled means free of items that may conduct electricity. Why is this important? From your recently submerged foray, you cell phone or PDA may have picked up the laundry detergent, dirt, etc. It is important to get those items out, however, this step is usually skipped by most.
Simply re-submerge the phone entirely in distilled water. If you have a light spray bottle (that the distilled water was purchased in) you can gently soak the phone. This also will help prevent rust on those hard to dry nooks and crannies.
4. If you really want to go to extreme with removing all traces of water then use an electronics cleaner, or if you're in a pinch, WD-40. (Your phone will smell like the lubricant though.) The silicone/WD-40 will drive water out of the phone. If you're really ambitious submerge the entire phone in WD-40 or silicone electronics cleaner in a bowl. You can also opt for rubbing alcohol in place of distilled water. It dries faster, hopefully it doesn't harm components though.
5. Let the phone dry on its own. DO NOT apply direct heat like a hair dryer or heater. The best option is to leave it out in a well ventilated area somewhere in the sunlight. Direct sunlight may not be the best option. A light powered light bulb (less than 60W) is also an option if sunlight is hard to come by.
6. Leave the phone for a minimum of 24 hours (even up to three days) or until all items appear dry. You only have one shot to restart the phone so it better be completely dry or all bets are off. Patience is a virtue in this case. Because you generally can't open the phone from all of its components there may be water logged in some cranny. You don't want rust, among other problems, to develop in the unit so work hard to remove all moisture.
7. All power contact that you have access to, battery and SIM, offer a quick clean (with your distilled water of course if you haven't done number 3.
8. Re-assemble phone placing battery in last, power on, watch the screen come to life! Generally when you submerge the phone the first thing to go is the LCD screen. Generally though, the rest of the body and hardware functions. Sometimes you're lucky and the screen remains as well.
Taking these steps, particularly numbers 2 and 6 at the minimum, will ensure the greatest probability of recovering some functionality for your waterlogged phone. If you have any other tips please feel free to share.
