Last year, Sony revealed that the PlayStation 3 would be available and only sold in a smaller model. When it was released a few weeks later, it was met with a great response because sales went through the roof. Although that could also be contributed to the price drop as well.

With both the Wii already the smallest system on the market and the recent change to the PS3, the Xbox 360 seems rather…big. However Microsoft plans on having a huge 2010 and they hope to create more buzz for their console in the upcoming months because of their controller-less, motion cam, Project Natal.

Up top is a picture of a motherboard, which the website AVG9 first grabbed. According to Kotaku, this is a complete overhaul of the Xbox 360, and it seems as though the system might have some big changes in-store for gamers. If Kotaku is correct, a new Xbox 360 is being created in China and will focus on having a smaller case — basically an ‘Xbox 360 Slim.’

For some time, rumors have been floating around that Microsoft was indeed going to go this route. Now with Project Natal around corner and the company hoping to revamped its image — so, what better way to do this than completely changing the look of the system?

If this is all correct, my guess Microsoft will announce the smaller system during their annual E3 press conference, which happens in June. From there, I bet the system will be in stores within weeks of its unveiling — which is exactly what Sony did when they released the PS3 Slim.