Instructions
Power on the Xbox 360 and TV set. Make sure the console is connected to the Internet.
Navigate to "My Xbox" on the Xbox 360 home screen using the controller.
Select the "Manage Account" option.
Select "Windows Live ID" from the Manage Account options.
Choose "Change Password."
Enter the current password twice when prompted using the on-screen password.
Choose "Change Password." Enter in a new password when prompted. Confirm the password.
Select whether to store the password by hitting "Yes" or "No." A stored password will not have to be re-entered when signing on to services such as Windows Live Messenger.