Try this script: http://www.unifycommunity.com/wiki/index.php?title=Headbobber

Originally based on this one, I made another script in C# which requires CharacterController and CharacterMotor, just drop it into the child camera and you should be set to go. I hope this is of use to someone. Cheers, using UnityEngine; using System.Collections;

public class HeadBobbing : MonoBehaviour {


// drop into the main character's camera
 // editor-accessible vars
 public float bobbingFreq = 1.8f; // in Hz, TODO make it dependent on speed
 private float bobbingFreqCached;
 public float bobbingRatio = 0.08f; // as a factor of character height

 // non editor-accessible
 private float phase = Mathf.PI;
 private CharacterMotor characterMotor; // we need to see if the character is walking or jumping (TODO maybe running and sliding)  

 private CharacterController characterController;

 private float height; //we'll need this for bobbing as a function of height

 private float bobbingAmount;
 private float heightDependency;
 private float currentBobbing; // keep track of y axis modification 
 private float bobbingDelta; // how much has bobbing changed in the last frame
 // Keep a mask for the displacement states where isWalking is xxx1 isStepping xx1x and isStopping x1xx
 private int stateMask = 0;
 private const int isWalking = 1; 
 // this next variable can be useful for triggering stepSounds, see getter below
 private const int isStepping = 2; 
 private const int isStopping = 4;
 // need to remember where camera was before we began toying with it. 
 // NOTE this wont work if anything else is moving the camera!
 private Vector3 OriginalCameraLocalPosition;

 void  Start (){
    characterMotor = GetComponent<CharacterMotor>();
    characterController = GetComponent<CharacterController>();
    height = characterController.height;
    OriginalCameraLocalPosition = Camera.main.transform.localPosition;

    heightDependency = transform.localScale.y * height / 2;
    currentBobbing = 0.0f;
    bobbingFreqCached = bobbingFreq;
 }

 void  Update (){ 
    bobbingAmount = bobbingRatio * heightDependency;
    if ( (characterMotor.inputMoveDirection != Vector3.zero) && characterMotor.IsGrounded() ) { 
        UpdatePhaseAndBobbingDelta();
        stateMask = stateMask | isWalking; // isWalking = true;
        stateMask = stateMask & ~isStopping; // isStopping = false;
    } 
    else {
        // bobbingDelta = 0.0f; // see note in our first branch
        if( (stateMask & isWalking) > 0 ){ // if we got here, we're stopping
           stateMask = stateMask | isStopping; // isStopping = true
           UpdatePhaseAndBobbingDelta( (phase > 0) ? 1 : -1 ); // if our phase is less than 0, rewind it
           if ( (stateMask & isStepping) > 0 ) {// we're back down
             Camera.main.transform.localPosition = OriginalCameraLocalPosition; // avoid cumulative errors
             stateMask = stateMask & ~isWalking;
             phase = Mathf.PI; // ready to start again
           }
        }
        else {
           bobbingDelta = 0.0f;
           stateMask = 0; // we're not doing anything
        }
    } 
    Camera.main.transform.Translate(Vector3.up * bobbingDelta, Space.World);    
 }

 // by default we add phase but it might be shorter to rewind it when stopping 
 private void  UpdatePhaseAndBobbingDelta (){
    UpdatePhaseAndBobbingDelta( 1.0f );
 }

 private void  UpdatePhaseAndBobbingDelta ( float direction  ){

    float twoPi = Mathf.PI * 2;
    // bobbing happens here, add one to Sin to avoid going under the terrain
    float previousBobbing = currentBobbing;
    currentBobbing = (Mathf.Cos(phase) + 1.0f) * bobbingAmount;
    bobbingDelta = currentBobbing - previousBobbing;
    // update phase in a frame-independent fashion
    phase = phase + (direction * (twoPi * Time.deltaTime * bobbingFreq));
    // wrap phase
    if (Mathf.Abs(phase) > Mathf.PI) { 
        phase = phase - (direction * twoPi); 
        stateMask = stateMask | isStepping;
    } 
    else
        stateMask = stateMask & ~isStepping;
 }

 public bool getIsStepping(){
    return ( (isStepping & stateMask) > 0 );
 }  
}

it is working when jumping too, should be solved, work work work :!