XNA"XNA Game Studio Express is a set of tools based on Visual C# Express 2005 that allow students and hobbyists to build games that target both Windows and Xbox 360." 

To all the enthusiasts, hobbyists and students who have ever asked me if they could develop apps for their Xbox 360, this is the news you were waiting for! 

Not only can you develop apps for your Xbox 360, but you can do so using a managed language that makes use of a custom, native implementation of the .NET Compact Framework 2.0 CLR (Common Language Runtime).

The beta is coming August 30th.  Here's more about XNA from the DirectX Developer Center.

[Update 15 Aug: Robert Scoble's thoughtful post alludes to the bigger story here: the Xbox 360 platform is being opened up.  You'll notice above I referred to developing apps for the 360 rather than developing games...]

From the FAQ on that site:

Windows Development with Game Studio Express
Developers will be able to download Game Studio Express from MSDN and develop games for Windows for no cost. Additionally, XNA Game Studio Express will allow developers to commercialize their games for Windows.

Xbox 360 Development with Game Studio Express
Developers wishing to target Xbox 360 for game development will need to join the XNA Creator’s Club. The XNA Creator’s Club will be a new Xbox Live subscription offering that will provide the additional pieces needed to develop non-commercial XNA Framework-based games on an Xbox 360 retail kit. The subscription program will be open to everyone. The subscription is available in 2 options, $99 a year or $49 for 4 months.