Yesterday Microsoft release the promised update to the Xbox 360 which will allow users to use USB Flash drives on their Xbox 360. You can use a USB drive up to 16GB in size as long as it meets performance specifications that Microsoft has for it to be able to work.
You can use all of your flash drive or part of it but you want to make sure to back everything up as it will erased everything on there regardless of which one you choose to do. What we’ve found so far is that most stuff is straight transfer only which means it will be moved off of your Xbox 360 hard drive over to the USB flash drive but some stuff can be copied over and kept on both but its very picky on what content that can be right now.
This is a great update to the 360 so you don’t have to buy those very expensive memory units. Wii uses based SD storage for saving games saves and content on it so its good to see Xbox come around to doing the same thing. I do think that this is intermediate step before Xbox release some type of cloud based storage for 360 owners.