If you want to restrice telnet access (or any other services for that matter), you have several ways (other people already gave answer, I'll just summarize here):

1. Use tcp_wrapper. Tcp_wrapper is available for almost all variant of unix. If not by default, you can always download it and compile yourself.

2. Use firewall/packet filter package:
Solaris:
- ipfilter (http://www.ipfilter.org)
- SunScreen Lite (http://www.sun.com/software/securenet/lite/)
- CheckPoint FW-1
FreeBSD:
- ipfw (the default firewall package for FreeBSD)
- ipfilter (you need to recompile the kernel to include ipfilter option)
NetBSD/OpenBSD:
- ipfilter
Linux:
- ipchains (for 2.2.x kernel)
- iptables (for 2.4.x kernel)
HP/UX:
- ipfilter (still in alpha)
- CheckPoint FW-1
AIX:
- CheckPoint FW-1 (?)
- IBM has its own firewall (I can't remember the name)