Microsoft has been slammed with a class action lawsuit in the US alleging the company knowingly distributed faulty Xbox 360 consoles.

The complaint has been filed in the US District Court in Illinois by Robert Byers. It alleges that the power supply and CPU in the console can overheat, causing the machine to freeze in use. This makes the machine “completely inoperable," the filing claims.

It’s alleged the flaws stem from Microsoft’s determination to beat competing consoles to market. Byers claims the company is knowingly selling a faulty product.

Byers is seeking damages for himself and others who may join the class action.

Online complaints when the product launched claimed several problems - including unexpected freezes - with the system.

Xbox enthusiast site polled site visitors to check the games machines worked properly. Nearly 15 per cent of the 915 who voted reported defective consoles.

However, Microsoft is offering to repair defective consoles as quickly as possible, the company said.