By Jonathan Fildes
Technology reporter, BBC News
The ban may have been timed for the release of Modern Warfare 2
Thousands of Xbox 360 owners who have been cut off from Microsoft's Xbox Live service will have to buy a new console if they want to play online again.
Microsoft told BBC News that banned machines will be permanently barred and "unable to connect to Xbox Live".
Microsoft has barred as many as 1m gamers from Xbox live for modifying their consoles to play pirated games.
"Users of banned Xbox consoles can recover their profile to another, unmodified Xbox 360 console to resume their Live service," the firm told BBC News.
"The banned console will be unable to connect to Xbox Live."
However, modified consoles will still work offline.
Microsoft said barring gamers was part of an ongoing drive to curb piracy.
But a statement from them suggests this latest wave was timed to prevent people from playing pirated versions of the widely-anticipated Call of Duty: Modern Warfare 2.
Microsoft said that it had banned a "small percentage" of the 20 million Xbox Live users worldwide.
Many gamers modify their consoles by installing new chips or software that allows them to run unofficial - but not always illegal - programs and games.
Some BBC News website readers claimed that they had "modded" their consoles to allow them to make back-ups of games that they had already bought.
"Discs are very fragile things and some users like to have their games backed up," said Donald Glass of Aberdeen.
"After all you will have paid £40 for a new disc. It is my opinion that once you buy a disc you should be allowed to do whatever you want with the media as long as you do not break copyright laws."
Microsoft has not said how it was able to determine which gamers to disconnect.
It said that gamers who had been barred were using their modified consoles to "play illegally pirated games".
"We believe that even one modified console on the system is one too many".
Industry figures suggest that piracy may cost the video game industry as much as £750m a year.
Reports have speculated that new "mods" could soon be on the market that allow gamers to get round the blocks.