If the red lights are flashing on your Xbox 360 it is most likely that you have encountered the 'ring of death', rather dramatic sounding but a big issue for Xbox 360 users.
When those lights start flashing, it is usually indicative of either a problem with your hardware or your power supply and there are usually indications prior to this that something is wrong, such as your screen or sound freezing up. These usually happen over a period of time before the system completely crashes.
The 'ring of death' is usually indicated by three flashing red lights, but faults are also indicated by one, two or four lights flashing. If you have one or two lights flashing, this is also a usual indicator of some kind of problem with your hardware caused by the system overheating and you are likely to get various E errors, like E66, E67 or E68.
If you find four flashing red lights, this is usually telling you that your AV cable isn't plugged in but can also be seen during play sometimes. This is caused by a power surge and is easily solved - you just unplug your Xbox 360 and then plug it in again.
You might be asking yourself where all these issues come from. Quite simply, it relates to problems caused by the system's design. It is very slim and contains some very powerful components - these generate a lot of heat and there isn't enough ventilation to deal with the build up, so it really is a recipe for disaster - problems with overheating are just waiting to happen.
The kind of solder used to make the system and its heat sink are also contributing factors, but basically the Xbox 360 just overheats way too easily, thereby causing any number of problems, of which your three red flashing lights are only one.
This might not be such a problem except that the Xbox 360 is incredibly popular in this day and age. The high quality graphics and awesome games pull you in and make you forget how long you have been playing - you completely lose track of time and this is the danger point.
There are two things you can do to try and prevent the system from overheating. Firstly, you need to try and limit the amount of time you spend playing on it in any one period. Secondly, think about where you have located the system. You need to make sure that it is receiving as much ventilation as humanly possible, and keep it away from any other equipment so that it doesn't get heated up by any external source.
If those three lights light up, try stopping play and letting the system cool down for a while, like a few hours. Unplug all the cables, including the AV, and then plug them back in. You can also take out the hard drive and turn the Xbox 360 back on afterwards. If the light is then green, you can put the hard drive back, turn the system on again and this should solve the issue. If it doesn't, you will probably have to get into repairs.
If the guarantee has expired, you can send your Xbox 360 back to Microsoft who will take a long time to fix it and send you an even longer bill once they do, or you can take it on yourself to repair the system.
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