If you want to sell your Xbox 360 or fix problems that are preventing you from playing or connecting to Xbox Live, reset your Xbox 360 to factory settings, which will delete all data without turning off Parental Controls. To disable Parental Controls, reset the passcode, but you have to prove (to Microsoft) that you have the right to do so. Clear your cache if your Xbox 360 degrades performance or freezes games.
Steps
Method 1 of 3: Factory Reset

Step 1: Reset your Xbox 360 to factory settings before selling or for troubleshooting purposes
This will delete all data, but Parental Controls will not be disabled. To disable Parental Controls, please prove to Microsoft that you have the authority to do so (see the next section).

Step 2. Create a backup copy of the information you need
Resetting your Xbox 360 to factory settings will erase all data. Therefore, please back up the information you need first.
- Connect an external hard drive to the Xbox 360 - it will appear as storage media.
- On your controller, press the Guide button and go to the Settings tab.
- Select "System Settings" - "Storage" and then select the hard drive of the game console.
- Select “Transfer Content” and then select the external hard drive.
- Highlight the information you want to transfer and press Start. The file transfer process will take some time.

Step 3. Press the Guide button on your controller
This is the center button with the Xbox logo.

Step 4. Select “Settings” - “System Settings”
The various categories of system settings will be displayed.

Step 5. Select "Console Settings" - "System Info"
A new window will open with information about the game console.

Step 6. Make a note of the information on the Console Serial Number line
This is the serial number of your Xbox 360, which you may need to do a factory reset. You can also find the serial number next to the USB ports (on the front of the Xbox 360) or above the A / V connector (on the back of the console).

Step 7. Return to the "System Settings" menu and select "Storage"
All media connected to the Xbox 360 will be displayed.

Step 8. Select your Xbox 360 hard drive and press the yellow Y button
The Device Options menu (that is, the settings for the internal hard drive) opens.

Step 9. In the menu that opens, select "Format"
The system will ask you to confirm that you want to erase all data on the hard drive. If you have already backed up important information, proceed to format the disk.

Step 10. Enter the serial number of the console (if required by the system)
To start formatting, you may have to enter the serial number of the STB. This is a protection against accidental start of formatting. Enter the serial number you wrote down earlier.
Formatting the drive will not disable Parental Controls. Read the next section for information on disabling this feature

Step 11. Delete the user
When formatting is complete, you will be returned to the main menu. The console will be disconnected from Xbox Live and all games will be removed. Go to Settings - System - Storage, find the user (yourself) and delete it.

Step 12. Begin initial installation
Go to “Settings” - “System” and click “Initial Setup”. Confirm your choice.
Method 2 of 3: Disable Parental Controls

Step 1. On your controller, press the Guide button
This is the center button with the Xbox logo. The Guide menu opens.
If you try to turn off the Parental Controls feature that your parents activated, you will fail because you cannot prove to Microsoft that you have the right to turn off this feature

Step 2. Open the Settings menu and select Family
A section with parameters for the "Parental Control" function will open.

Step 3. Select "Content Controls"
You will be prompted to enter your current passcode.

Step 4. Enter the wrong passcode to start the reset process
Since you do not know the access code for the “Family” menu, enter the wrong code and the system will prompt you to enter it again.

Step 5. When prompted, select “Reset Pass Code”
The screen will display a security question to reset the code.

Step 6. If you can, answer the security question
If you created the passcode yourself, answer the security question and enter a new code. If you don't remember the answer to the security question, or if the access code was created by another person, read on.

Step 7. Contact Xbox Support if you are unable to answer the security question
If you bought a supported console whose owner hasn't removed the passcode, or if you don't remember the secret question, contact Xbox Support to obtain the passcode reset code.
Support (support.xbox.com) can be contacted via online chat or by phone. You will be prompted to answer a series of questions to determine if you are eligible to disable Parental Controls (Xbox Support will not disable this feature if your parents have enabled it)

Step 8. Enter the code provided by Xbox Support
If Xbox Support approves your request to turn off Parental Controls, you will receive a code that you can use to bypass your current passcode. You can then turn off Parental Controls or create a new passcode.
Method 3 of 3: Clearing the cache

Step 1. If you are experiencing technical issues, clear your Xbox 360 cache
If your console's performance drops (games freeze, navigation between menus is slow), clear the cache to troubleshoot. This method is especially effective with older games. Clearing the cache will not delete games, saves, or other media. Clearing the cache will remove the game updates, so you'll have to download and install the updates again.

Step 2. Press the Guide button on your controller
The Guide menu opens.

Step 3. Select “Settings” - “System Settings”
The categories of system settings are displayed.

Step 4. Select "Storage"
All media connected to the Xbox 360 will be displayed.

Step 5. Select any storage medium and press the yellow "Y" button
The Device Options menu opens. Choose any storage medium, as you are going to clear the cache of the entire system. Step 6. Select “Clear System Cache” and then confirm your decision.
It will take a little time to clear the cache.
Advice
- Reset your Xbox 360 to prevent unauthorized people from gaining access to your personal information before selling or gifting a console.
- Make sure to disable the Parental Control passcode.