Like many other network devices, the Xbox 360 uses the domain name system (DNS) to translate Internet addresses into numerical Internet protocol (IP) addresses. If the console is unable to retrieve the values for the DNS, the Xbox 360 will not be able to connect to the Xbox Live network properly. The following demonstrates how to resolve most issues surrounding DNS errors, which can be caused by faulty networking equipment or incorrectly set DNS values.
Turn off the Xbox 360 console by pressing the power button on the front of the console. If you have a wireless networking adaptor installed, unplug it from the USB port. Turn off all wired or wireless hardware capable of supplying an Internet connection to the Xbox 360 console; this includes wired and wireless routers and modems.
Turn on the modem and allow it to fully restart. Then, turn on the wired or wireless router connected to the Xbox 360 console and allow it to fully restart. Repeat this process for every other piece of hardware connected to the console.
Turn on the Xbox 360 console and scroll to "My Xbox". Select "System Settings" and then select "Network Settings". Choose between "Wired Network" or "Wireless Network" and then select Test Xbox Live Connection. Allow the test to fully complete. If any DNS errors persist, move on to the next step.
Enter a manual DNS value for use with the Xbox 360 console. This value can be retrieved from your computer by checking its network settings, or by contacting your ISP. Make sure to copy the values down on a piece of paper. After acquiring the correct DNS values, select the wired or wireless network you're using on your console and select "Configure Network." Choose "DNS Settings" on the "Basic Settings" tab and select Manual. Select "Primary DNS Server" and enter the first DNS value. Select "Secondary DNS Server" and enter the second DNS value. Afterwards, test the Xbox Live connection once more.
Use a direct connection to your modem if you still have DNS errors. Directly plug your Xbox 360's Ethernet cable into the modem. If the DNS error is resolved, you may be having problems with your router. Consult the router's instruction manual for how to resolve this problem.