Some Xbox 360 problems can be fixed, but it may be cheaper to replace the console than to fix it. An Xbox 360 is basically computer, and it contains some recyclable parts. There are several options to explore when considering what to do with your broken Xbox 360.
If your Xbox 360 is still under warranty, contact Microsoft or the vendor you purchased it from to see if the console can be repaired for free. Unless it was damaged from dropping it or spilling something on it, or you modified your Xbox 360, thus voiding the warranty, your warranty may cover repairs.
Paying for repair may not be out of the question. Check with local computer and electronics repair shops to see if your Xbox 360 can be repaired and what the cost will be for the repair.
Search for the symptoms online, starting at the Xbox Support site before moving on to your favourite search engine. If you or a friend are handy at fixing electronics, the repair instructions for your Xbox 360's problem may be posted online. Your Xbox 360 is already broken, so you probably can't make it any worse.
There is a market for used game consoles, and someone may be willing to buy your broken Xbox 360 to repair or use for spare parts. Check with shops that deal in used equipment, such as GameStop. You may be able to find a local buyer by listing it online on classifieds sites like Craigslist, or even in the newspaper.
Using an online auction site like eBay will generally get you a fair price. Make sure to charge the correct price for shipping. Even if you don't get much for your broken Xbox 360, it won't cost you anything to send it off to someone who wants it and may be able to give it new life in some form or another.
It is very important to be as honest, upfront and detailed as possible with potential buyers about the problems with your Xbox 360. Did it get banned because you modified the Xbox 360? Did you damage it? Was it the red ring of death? Describe the problems and explain the symptoms. Not only is it fair to the buyer, but being honest about the problems may get you more money for your Xbox 360.
If you are going to buy another game console, see if you can trade in your broken Xbox 360 for credit toward the new one. Some vendors have programs to take your old gear for recycling when you buy a new system.
There are several sites that will recycle your Xbox 360, and perhaps even give you a little money for it depending on its condition and whether or not you send the cords, controller and manuals with it. See the Resources section for links.
Your local recycling centre or landfill may be able to recycle your Xbox 360. Call them to see if they can recycle it and what you need to do. Some recyclers may charge a small fee.