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An updated version of the service became available for the Xbox 360 console at the system's launch in November 2005, and a further enhanced version was released in 2013 with the Xbox One.

The service was extended in 2007 on the Windows platform, named Games for Windows – Live, which makes most aspects of the system available on Windows computers.

As Microsoft developed the original Xbox console, online gaming was designated as one of the key pillars for the greater Xbox strategy.

Sega had made an attempt to capitalize on the ever-growing online gaming scene when it launched the Dreamcast video game console in 1999, including online support as standard, called Sega Net and Dreamarena.

On November 15, 2007, Microsoft celebrated Xbox Live's 5th anniversary by offering its then over 8 million subscribers the title Carcassonne free of charge and awarding gamers who had subscribed to Live since its inception 500 free Microsoft Points.