With the latest update to Gingerbread (Android 2.3.3), the contact list on the Droid X can now be sorted by last name. Here's how:
Step 1: From your contacts list, hit the Menu key, then select Display Options.
Step 2: In Display Options, select Sort list by.
Step 3: Select Last name to sort your contacts by last name.
That's it. Now you can finally sort your contact list on the Droid X by last name.
Discuss: How to sort contacts by last name on your Droid X
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