Microsoft is preparing to update its Xbox 360 with another dashboard update. Sources familiar with Microsoft's Xbox plans have revealed to The Verge that the dashboard update will enter into a public beta in late June or early July, with changes and updates in preparation for the next-generation Xbox. We're told that the user interface will be refreshed alongside smaller Live Tiles, similar to what Microsoft is preparing for Windows 8.1. Microsoft is also said to be tweaking the look of the Xbox dashboard, with the possibility of darker or lighter themes.

We understand Microsoft is aiming to ensure Xbox 360 users can transition over to the next-generation console and interact with existing Xbox 360 users using messaging, beacons, and achievements. Microsoft will also phase out the use of its Points system with this dashboard update, replacing it with currency and gift card options. We're told that the final update will be made available, providing the public beta testing goes to plan, in August.

All will be revealed soon

Microsoft is holding a special event at its campus in Redmond on May 21st to unveil the next-generation Xbox. Sources have revealed to us that the event will include details of the new interactive TV features that the company is building into its next console. Microsoft is also expected to show off a smaller and denser Xbox console with newly designed controllers that are said to be "flattened" in appearance. Stay tuned to The Verge for our usual live blog coverage and a special edition Vergecast on May 21st.

Microsoft isn't commenting about any planned dashboard changes. "We don’t have anything new to announce at this time," says a spokesperson.