http://www.mostmerciful.com/abrogation-and-substitution.htm
I thought this article did a great job of explaining the misunderstanding some anti-islamic people have about Ayat 2:106 in the Qur'an.
The problem is with the interpretation of "ayatin" [transliteration]. The arabic word for revelation or signs from God. It is used throughout the Qur'an in reference to the signs given to jews, christians and muslims. The Torah is ayatin. the Bible is ayatin. and the Qur'an is ayatin.
But since the section around 2:106 is talking about christians and jews... the context explains the verse. Since the Qur'an is poetry, one line in and of itself is not a complete thought or idea. It needs the lines around it to give it context. When you read the whole section it is clearly apparent that 2:106 is talking about ayatin given to christians and jews. Because of this, the Qur'an never abrogates itself. We are told this in other verses of the Qur'an, that the Qur'an is perfect and complete and only our understanding of it can be faulty. So the Qur'an abrogates previous revelation. For example, christians are allowed to drink wine and intoxicants. Muslims cannot. Christians are not supposed to divorce. Muslims are allowed to. Jews are supposed to stone adulterers to death. Muslims are only supposed to punish adulterers with a lashing or spanking. And so on... the Qur'an has abrogated these rules from previous revelation.
Here is an excerpt from the weblink just in case the website goes down or the page disappears in the future...
Surah Baqara (2) - Verse 106, translation by Abdullah Yusuf Ali:
None of Our revelations do We abrogate or cause to be forgotten but We substitute something better or similar; knowest thou not that Allah hath power over all things?
Transliteration:
Maa nansakh min 'aayatin 'aw nunsihaa na'-ti bi-khayrim-minhaa 'aw mislihaa; 'alam ta'-lam 'annallaaha 'alaa kulli shay-'in-Qadiir(un)?.
Important Notes:
1. This verse opens with a conditional sentence. Hence the opening portion of the sentence is subjected to the rest of it. Please note the word "but" used by Yusuf Ali to connect the ensuing text. Quoting the first part of the sentence by itself would amount to misleading the readers. Substitution is acknowledged. The Abrogation is negated and so is the concept of causing to be forgotten.
2. The use of the negative particle "Maa" in the beginning of the verse emphatically negates this conditional Perfect Sentence. Below is another example from the Qur'an, wherein the word "maa" is used in the beginning of a conditional sentence to Negate the text, with the specified exception.
Transliteration:
Maa qultu lahum 'illaa maaa 'amarata bihiii 'ani'-budullaaha Rabbii wa Rabbakum:...
Translation of Surah Maidah (5), Verse 117 by Abdullah Yusuf Ali:
"Never said I (Jesus), to them aught except what Thou didst command me to say, to wit, 'Worship Allah, my Lord and your Lord':...
To propagate the opening portion of the above verse out of context would amount to saying that Jesus Christ never spoke anything to disciples.
Are the verses of the Qur'an Substituted?
OR
The earlier revelations are Substituted
by the later revelations?
3. The word "aayatin" in the verse under study (2: 106), translated as "Our revelations" is used to denote the "total revelations of Allah" that have come to mankind. In other words it includes Allah's Messages that were conveyed in the earlier books as well as the final Message revealed by Him in the Qur'an.
4. In his commentary, Yusuf Ali explains the term "aayatin" as under:
What is the meaning here? If we take it in a general sense, it means that God's Message from age to age is always the same, but that its form may differ according to the needs and exigencies of the time. That form was different as given to Moses and then to Jesus and then to Muhammad.

