] The XBOX Dashboard is what appears when you turn the XBOX
] on without a disc in the DVD drive. It will let you
] adjust system settings, manage your save games, play and
] rip audio CDs and configure your XBOX Live account. It is
] the heart of the XBOX and its most vulnerable point,
] because it lacks several security restrictions which are
] enforced on games. This includes the lack of the
] reboot-on-eject-button "feature", which is obligatory for
] all games.

] The existance of an exploitable vulnerability
] within the dashboard could totally compromises the XBOX
] security system. It will make the box independent from
] Microsoft signed code and therefore this information is
] released to the public now on the 4th of July 2003, the
] day of the XBOX Independence.

From the Full Disclosure mailing list.

XBOX Dashboard local vulnerability