Microsoft has partnered with Asus to release Xbox-branded versions of handheld gaming PCs. The devices are called Xbox Ally and Xbox Ally X. Both run Windows and boot into a new full-screen Xbox interface designed specifically for handheld use.
Preorders sold out quickly on Microsoft’s online store. Best Buy orders reportedly show lead times of about two months. The strong early demand signals interest in Microsoft’s approach to portable gaming.
The Xbox Ally is not an Xbox console. It’s a Windows PC manufactured by Asus with Xbox branding and software. This means it plays PC games, not Xbox console games. The distinction has caused confusion among buyers who expect it to run their Xbox digital libraries natively.
The base Xbox Ally costs $599.99 and uses an AMD Z2 A processor. This chip delivers performance similar to the Steam Deck. The higher-end Xbox Ally X is priced around $1,000 and features significantly more powerful hardware that reportedly outperforms the Steam Deck by a wide margin.
Both models can run any Windows gaming launcher. Users can install Steam, Battle.net, Epic Games Store, and GOG alongside PC Game Pass. The new Xbox interface can display games from all these platforms in one unified view.
Xbox console games cannot run natively on these devices. Players can access them through Xbox Cloud Gaming streaming. Games that support Xbox Play Anywhere will work as PC versions if the user owns a PC license. This is a critical distinction that has frustrated some buyers expecting full Xbox console compatibility.
The devices compete directly with Valve’s Steam Deck, which starts at $399.99 and runs SteamOS. The Steam Deck offers a streamlined experience focused on Steam games. Windows handhelds like the Xbox Ally provide broader compatibility with PC games, especially those using kernel-level anti-cheat that doesn’t work on Linux-based systems.
Asus already sells non-branded versions of these devices as the ROG Ally and ROG Ally X. The Xbox-branded models add Microsoft’s new handheld interface and deeper integration with Game Pass services.
Not just for Xbox Ally
Microsoft plans to bring the new handheld-focused interface to other Windows gaming handhelds. The Xbox Ally serves as a testing ground for these UI improvements. Other manufacturers running Windows on portable devices will eventually receive the same interface updates.
This partnership represents Microsoft’s broader strategy to expand the Xbox brand beyond traditional consoles. The company has been positioning Xbox as a gaming service available across multiple devices rather than just hardware in a living room.
