Microsoft wants to ensure that messaging, beacons and achievements carry over to the new console while also experimenting with the user interface a bit, the report claimed.
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Specifically, the Xbox 360 dashboard UI tweaks are said to make it look more consistent with the planned Windows 8.1 design thanks to smaller Live Tiles.
Currently, the video game console sports a Metro interface with larger tiles, which replaced the "New Xbox Experience" and original five "Blades" design.
Xbox 360 dashboard beta
It's unclear when Microsoft plans to launch the Live Tile version of the Xbox 360 dashboard, but the report does indicate that there will be a late June or early July public beta test.
The company has consistently released a public beta of its dashboard updates in the summer in an effort to test and hype the changes that become public in the fall.
That would be perfect timing for gamers to prepare for the new Xbox hardware, which is expected to hit shelves before the end of the year to challenge Sony's PS4.
Other dashboard features
Likely changes to the Xbox 360 dashboard may include darker and lighter themes compared to the system's current Metro interface, according to The Verge.
Additionally, when the new update rolls out, it may very well mark the end of the Microsoft Points currency system, which the company first introduced alongside Xbox Live in 2005.
With the Xbox brand taking its lead from Windows 8, some have suggest that the name of the new system could very well be Xbox Infinity - the number side turned on its side.
Microsoft is expected to reveal the true name of the new Xbox along with what may be the final Xbox 360 dashboard update on Tuesday. TechRadar will be in Redmond to cover the event live, so be sure to tune in at 10 a.m. PT/6 p.m. BST for the latest news.