Xbox Kinect Is Holiday Season's 'It' GadgetXbox Kinect Is Holiday Season's 'It' Gadget

Microsoft's got a blockbuster on its hands. The company said it sold more than 2.5 million Xbox Kinect units since launching the product earlier this month—making it one of the hottest selling E-toys for the crucial holiday shopping season.

In fact, the hands-free controller system for Xbox 360 is such a hit it's sold out at many retailers and is commanding premium prices on Ebay.

"We are thrilled about customer response to Kinect, and are working hard with our retail and manufacturing partners to expedite production and shipments of Kinect to restock shelves as fast as possible to keep up with demand," said Don Mattrick, president of Microsoft's Interactive Entertainment Business, in a statement.

Microsoft is offering Kinect bundled with a 250GB Xbox 360 for $399 while the 4GB version is selling for $299. The Kinect sensor bar is also available as a standalone product for $149. But a check of Web sites for major retailers like Amazon and Best Buy showed that supplies are tight, with some bundles on back order.

The Kinect bar features a camera, audio sensors, and motion-sensing technology that tracks 48 points of movement on the human body. That means players can control on-screen action simply through physical gestures and verbal commands. The sensor bar is designed to plug directly into the Xbox 360 console.

Retail executives are counting on Kinect to drive big sales during the holidays. "Kinect on Xbox 360 was a top performer at Target this weekend," said Nick Nayar, VP for merchandising at Target, in a statement.

"We expect Kinect will be a must-have gift this holiday season, so Target will continue to receive consistent shipments of Kinect throughout December. The hands-free, active gaming experience that Kinect offers is something that everyone in the family can enjoy," said Nayar.

As of early Tuesday, Target's Web site said some Kinect bundles were sold out.

Microsoft recently unveiled a slew of Kinect compatible games. The most high-profile title on the list is "Harry Potter and the Deathly Hallows—Part 1 The Videogame." From Electronic Arts, the $49.99 game gives players the chance to assume the character of the famous boy wizard and walk the halls of Hogwarts.

Also launching for the holidays are Kinectimals (Frontier Studios), which lets players interact with on screen zoo animals, Your Shape: Fitness Evolved (Ubisoft), which provides exercise routines with the help of a virtual, on-screen trainer, and Kinect Sports (Rare), which lets users play simulated soccer, bowling, volleyball, and other games.

Kinect Joy Ride (Big Park), meanwhile, is billed as the world's first hands-free racing game, and Dance Central (MTV Games) allows players to groove to tunes by artists like Lady Gaga, No Doubt, M.I.A., and more.