If your Xbox 360 has stopped working and you are getting the 3 red light error don’t panic, there is hope. With some basic tools and a decent repair manual you can fix it yourself.
You will need a set of torx screwdrivers, If you do not have a set you can pick up a cheap set at your local hardware store.
The 3 red light error means there is a general hardware failure. First thing you can try is to dis-connect everything and let your console sit for 20 minutes unplugged from the power. Re-connect everything and try it again, If you are still getting the error remove the hard drive and re-install it. Sometimes they get loose and you get a bad connection.
If that did not fix it you will need to open it up at this point. The most common failures are no video or disks will not read. Both can be repaired fairly easy.
If you have no video you can try a different video cable, borrow a friends if you do not have another one. If you still have no video but audio is working you will need to check the soldering connections on the main board for the video connector. Consult the manual before attempting this or any other internal repairs.
If your Xbox is not reading the disks or getting disk errors make sure your disks are clean. After that you may have to replace the DVD drive or if you have the skills you can remove the DVD drive and replace just the pick up assembly. This is a lot cheaper than replacing the whole drive. Again consult the repair manual before attempting this.
Your other option is to send your console off to Microsoft and Wait. Nothing worse than having Halo 3 and not being able to play it. I prefer to do my own mods and repairs. The console unit is very similar to your home computer, it is actually a small computer. With a little patience anyone can learn how to do there own repairs.
Once you learn about the inner workings of you game console and repair it you will become real popular with your friends when the game breaks down. This has turned into a part time business for me. Word seems to get around fast. If you want you can make some decent money doing repairs. People would much rather have someone local do their repairs.