* Allows up to two USB flash drives or external hard drives to be used for storing profiles, game saves, demos and more up to 16 GB each, 32GB combined.
* Allows content transfer to another attached storage device. Content transfer does not copy installed games.
* Brings back to banned consoles the option to install games to hard drive in order to decrease load times and to make the hardware quieter.
* Enables (previously inactive) WPA2 support for the official Xbox 360 Wireless Networking Adapter.
* Disables support for 3rd-party memory cards (e.g. Datel Max Memory).
* Enabled Facebook, Twitter, Last.fm and Zune Marketplace on November 17, 2009. Facebook, Twitter and Last.fm are only available to Xbox Live Gold Members.
* Disables hard drive installs for banned consoles, can no longer be used as a media centre and profile and saves are corrupt when used on another console
* Mandatory update that prepared for subsequent growth of the Xbox 360 console and/or Xbox Live. Specifically, preparations for the additions of Facebook, Twitter, and Last.fm to the dashboard.
* Update that fixes issues with limited games and with dashboard.
* Adds Display Discovery to allow console to override factory settings for HDTV resolutions and refresh rates. Also discovers the best possible resolution and refresh rates that your HDTV is capable of displaying (Selected HDTVs).
* Adds HDMI Reference Levels
* Adds the Avatar Marketplace.
* Adds Games on Demand to the Game Marketplace.
* Community Games rebranded to Indie Games.
* Adds the ability to rate content (Uses a 5-star rating system).
* Introduces Xbox Live Gold Member Veteran Status.
* Improves Netflix.
o Users can now change the instant queue from the console.
o Adds Netflix movie parties.
* Ability to eject tray even when a disc is already inserted.
* Improves Xbox Guide performance.
* Reduces hard drive game installation sizes.
* Adds a Clear Cache option to the storage units.
* Adds a „Prizes“ area to Xbox LIVE Primetime.
* Xbox Live Primetime (Summer 2009).
o Play game shows with friends over Xbox Live to win Microsoft Points and Themes (For example: 1 vs 100).
* Fixes a vulnerability used to run arbitrary code.
* Update that fixes issues with limited games.
* Mandatory update that fixed HDMI audio issues caused by the New Xbox Experience update.
2.0.7357.0 2008-11-19 
NXE: New Xbox Experience
User Interface changes
* Completely redesigned GUI with a navigation system similar to that of Windows Media Center.
o New pop-up/in-game Live Guide, using a redesigned version of the blades interface.
o New sound effects (menus only, notification sounds remain the same).
o Ability to preview your own themes before setting them.
o Ability to disable notifications (new messages, chat requests, etc.) or mute the notification sound.
* Support for 1440×900 and 1680×1050 16:10 resolutions (letterboxed) over VGA, HDMI and when using DVI.
* Ability to change to QWERTY keyboard in place of alphabetical keyboard.
Xbox Live changes
* Xbox Live Party allowing for eight-person chat and image sharing.
* Fully customizable Avatars for use in upcoming games and on Xbox Live. (Some current games also received an update on November 19th to support the new Avatars).
* Access Xbox Live Marketplace on a PC via Xbox.com with the ability to queue downloads to the Xbox 360.
* Ability to watch Netflix movies on an Xbox 360. (User must be in the US, a Gold Xbox Live member, and a Netflix Unlimited subscriber)
* Increases the Active Downloads queue limit from 6 to 40.
* Option to install games to hard drive in order to decrease load times and to make the hardware quieter. The disc must still be present for the game to load.
* Information from Xbox Live regarding the game in the disc tray.
* Quick Launch for launching games on your console.
* Ability to remove games with 0 gamerscore from your profiles played games list.
* Upon starting any Xbox 360 game, you will be notified if any of your friends and/or party are playing the same game.
* Auto Start – Option to set whether you want the disc to run/or stay idle when the disc tray closes with a game or media disc inside, by default it’s set to run.
NOTE: Update requires 128 MB of free memory
* Microsoft have stated that the NXE will be released to non Xbox Live members (eg: on DVD in OXM) at a later date. It is now also available with certain games on the disc itself.
* Mandatory update that prepared for subsequent growth of the service.
* Mandatory update that prepared for subsequent growth of the Xbox 360 console and/or Xbox Live.
* Support for MPEG-4 Part 2 video playback and AC3 audio. (With Optional Media Update)
* Xbox Live Arcade trial games are no longer written to Gamercard.
* Original Xbox games played now appear in the user’s played games list.
* Parental Timer.
* Xbox Guide opens significantly faster.
* Inside Xbox news feed.
* Game gameplay fades out when console is turned off.
* Social Networking features.
* Redesigned user interface.
* Improved performance.
* The ability to view your friends‘ friends list (Friends of Friends).
* You can now put your name, city of residence and a biography under your gamertag.
* The marketplace has been redesigned and is now more organized.
* The user’s downloaded videos are now organized by TV show and season.
* Prepared the system for communication with the Xbox 360 Big Button Controller (bundled with Scene It? Lights, Camera, Action).
* Prepared the system for communication with the Guitar Hero III: Legends of Rock Les Paul wireless guitar controller.
o A separate, fifth blade for the Marketplace.
o A more consistent interface for the Marketplace.
o Windows Live Messenger integration with the Dashboard.
o Switchable aspect ratio during video playback (Auto to Letterbox, Zoom, Stretch, Native).
o Support for „Reference Levels“ to video.
o The information bar that turns on via the On-Screen Display (OSD) now shows exactly how much time has lapsed in the playback of the video file.
o The ability to see the percentage of downloaded Video Marketplace content and where the ‘chapters’ exist for the said file.
o Support for MPEG-4 videos.
o Low-power background download function. The storage device, one core of the CPU, the fans, and any other components required for downloading remain powered, but rest of the system, such as the GPU and the disc drive, is shut off. System completely powers off once downloads are complete.
o Download blocks to prevent a download from starting if it will not fit onto a storage device, without deducting any points associated with the content item.
o Title of a game (when inserted into system) appears in the tray icon on the Dashboard menu. When highlighted, achievements and Gamerscore are displayed for that game based on the signed-in user.
o More specific “Achievement Unlocked” message, detailing the achievement unlocked and how many points it is worth.
o Windows Media protected content (WM-DRM), which can now be streamed from the PC to the console. If the WM-DRM license is missing or corrupted, then a specific error message is displayed to the user. Bookmarking is also stored for protected content.
o Two new languages, Russian and Polish.
o Option to boot straight into Media Center Extender mode (as well as changing the MC logo to the Vista version).
o Option to automatically download all free Xbox Live Arcade games.
* Fixed a Privilege escalation vulnerability in the Hypervisor that allowed non-signed code (such as Linux) to run on the Xbox 360, with direct hardware access.
* Improved performance on wired headsets when used with a wireless controller.
* Video output issues on VGA connections fixed.
o Support for 1080p video output.
o Support for Zune.
o Support for the external HD DVD drive attachment.
o Streaming of WMV files from a computer through the use of Windows Media Connect, connected USB device, CD or a DVD.
o Windows Media Player 11 as a supported streaming program.
o Audio and video streaming for Macintosh systems using Connect360.
o Option for automatic downloading of trial versions of newly released titles in Xbox Live Arcade.
o Cosmetic changes to the Dashboard.
* Improved character recognition for users with the localized Chinese language version of the dashboard on their Xbox 360(s).
o Option to resume DVD playback from where it was last stopped.
o Option to boot to either a disc or the dashboard when system is turned on.
o New slideshow options for Photo Viewing, which can save folder layouts between sessions.
o Concurrent downloads, allowing multiple downloads as background tasks.
o Xbox Live Marketplace was reorganized.
* Prepared console for subsequent system and title updates.
* Improvements to the Xbox Guide.
* Option to retain saved games when a profile is deleted.
* Increased accuracy of „last time played“.
* Network configuration improvements for Xbox Live members in the Netherlands.
* More detailed messaging for unreadable disk or region errors.
* Update available at product launch.
* Original shipped version (The backup of 2.0.1888.0 remains in the backup kernel storage).