It "will" work fine with the camera, but it will crop the sensor. Think of the D700 sensor as a big rectangle, and the D90/D300 sensor as a square inside of it, like this:

l——I————I——–l
l
l
l
l——I————I——–l

The D700 is a larger, full frame sensor. If you use a DX-series lens, then the D700 will only use the middle of its sensor, so that it works like a D300 (athough pixel density is lower on a D700 than a D300).

So, while it WILL work, when you buy a D700 you are paying for the extra sensor size. By using that lens, you have now wasted money on the D700. If you want your money to go the furthest, get a D300, although if you didn’t know the answer to this question, I would start with a D300 instead of getting a camera beyond your capabilities. If you can’t personally answer why you need the better camera, then you don’t need it, trust me.

Try this website out, it offers good advice for people that don’t know how to decide for themselves:
http://www.bythom.com/upgradepath.htm
References :

While the other answers are correct, and elude to the smaller frame used by the D700 in DX mode, they did not overtly state an important fact, that you only get 5.1 megapixel shots.
References :
<a href="http://brettmaxwellphoto.com/2009/09/07/canon-5d-mark-ii-compared-with-nikon-d700/">My review of the D700</a>