XLink allows you to play Xbox games online with other people - completely free and legal. Each game with LAN-support will work, that includes popular games like: Halo, Project Gotham Racing2, Rainbow Six, SegaGT Online, CounterStrike, XIII, ... (full list)

And there seems to be some confusion about this, so I'll repeat it: it works on both unmodded and modded Xbox.

How to use (short): make an Xtag, download the software, unzip, launch 'Launcher.exe', click 'Install WinPCap' if it's not installed on your system yet, then click 'Launch Kai', fill in the xtag and pass you made, click login, now MAXIMIZE(!) the application to see the chatroom.