There are two things I've seen that can cause an echo in a phone. One, the volume is turned up high enough that you start getting feedback between the mic and the speaker. Try turning the volume down. Two, earrings. This is a little more unusual and I can't say I've ever seen it specifically with the iPhone. If you wear earrings, especially ones on the large side, try taking them off. You're issue may be entirely different, however, neither of these things take very long to check, so, it can't hurt.
I've been having echo problems every since I got my new iPhone 4S. My problem is different though. I have not heard an echo of my voice ever...but the people I am talking to on the other end are getting an echo of their voice. This only happens to them when they talk to me with my new phone and it's many different people. It doesn't seem to matter if I'm talking to them on their land line or a mobile line.
I had Apple swap the phone for a new one two weeks ago and I am still having the same problem...if in so fact that they actually swapped the phone. They said they did.
Today I went back to Apple and they wiped the phone clean and reinstalled the software, thinking that maybe it's a software problem. Still didn't fix the problem. I might be super unlucky and received two faulty phones, if so Apple has a big problem on their hands.
Adjusting the volume on my phone while in a conversation doesn't really seem to help much. Also, it doesn't happen on every call or the entire time I'm in the call. Usually starts up about a minute or two into the conversation.