Sometime over the next few hours when you sign in to Xbox LIVE you’ll receive a prompt to accept this mandatory update. If you are signed into LIVE already, you may be signed out and asked to accept the update and you’ll be back online in a few moments.

This update does not include the Facebook, Twitter, Last.fm and Zune features. Those will be coming to Xbox LIVE later next month. This update adds WPA2 support for the Xbox 360 Wireless Network Adapter.

Source: majornelson.com