What happens when Xbox Live goes down?

When Xbox Live goes down, users are unable to sign-in or access games and applications. This is due to server errors, as stated by Tech Times.

Following notice of the outage, Xbox support works to rectify system issues that cause the outage. The customer service team responds to social media inquiries and directs users to stay up-to-date on the status by checking the Xbox Live Status website. Services and applications can be affected by outages individually or as a whole. When service goes down, it can take hours or days to repair. While Xbox Live is down, users may continue to use the gaming system with limited functionality where available.