The company has announced "a zero-tolerance policy when it comes to modded consoles connecting to Live".
Users attempting to connect to the online service with a banned console receive an error message with the status code Z: 8015 - 190D.
Gamers modify consoles for a variety of reasons, very few of them with legitimate intentions.
The most common use is to allow the playing of copied games, usually pirated versions, although some argue that the ability to copy games allows them to use backup versions and keep the original version stored safely elsewhere.
People also modify consoles to allow the running of other operating systems and applications or to circumvent cheat prevention systems.
Microsoft is not banning the users' accounts, but rather the systems themselves. Users will not be automatically banned from Live, but will no longer be able to access the service from the modified console.
The move is to help prevent "inappropriate behaviour like hacking or cheating ", according to Microsoft. The company will "continue to enforce this rule to ensure the integrity of the service and protect our partners and users".
The announcement has prompted a huge response with hundreds of replies on the official Xbox Live blog.
Most of the comments praise the move but there are several people claiming that their genuine unmodded consoles have been banned.
Other commentators have pointed out the potential problem of sites such as eBay being flooded with consoles that have been banned or people deliberately overheating their banned consoles in order to get a replacement under warranty.
Microsoft bans modded Xbox 360s from Live
By Staff Writers on May 22, 2007 10:15AM