Is your Xbox overheating?
Fixing your Xbox 360 has generally been limited to a variety of strange and pretty much unreliable methods. The Towel Trick fix is somewhat interesting. I would recommend that you stay clear of this one. Chances are that you are going to set your Xbox on fire trying this trick. Seriously, can you really fix anything just by wrapping your Xbox in a towel?
At least there is now a simple and cheap way to fix your console, check out this xbox 360 broken guide. The guide offers a complete solution for hardware failures associated to the Xbox like the dreaded red ring of death.