It should do..as long as the xdsl install is working from the hdd as debian, and all the dependencies are met, It's not the most compatable linux install..size vs function. And as with everything linux it's going to be a lot more DIY than you think.. Another thing to test is if your xbox drive will even read the cd. Try having a look at www.damnsmalllinux.org and maybe ask there. If anybody knows if this will work they will...