|This question is transcluded from the main Wikianswers site. To change or add to the answer, please edit the question there.|
Xbox LIVE is the Xbox and Xbox 360's online services. For $60 (£40) a year, an Xbox LIVE account gains Gold status, which allows the account to play games online, use Netflix, Facebook, Last.fm, and Twitter (providing you have existing accounts with these) with more applications to come, and in general creates the online experience that the Xbox(360) is known for.
The free version of Xbox LIVE is called Xbox LIVE Silver Membership. This restricts users to adding friends, messaging, and downloading content whereas Gold Membership gives the user access to all Xbox LIVE features.