No. Microsoft officially supports USB storage for game installs (updated in 2012 via system update).
Loading assets from flash memory or a hard drive is significantly faster than reading from an optical disc, which can fix frame rate "hiccups" and improve menu responsiveness. install games xbox 360 usb best
To ensure the best experience, the choice of hardware is critical. While the Xbox 360 theoretically supports up to 2TB of external storage via its USB 2.0 ports, performance varies wildly between device types: External Hard Drives (HDDs): To ensure the best experience, the choice of
To get the "best" performance, you need the right hardware. Not just any USB stick will do. This is the safest method for stock consoles
This is the safest method for stock consoles. You still need the disc in the tray to play (for security), but the game runs from the USB. Insert your game disc.
To install and play games on an Xbox 360 using a USB drive, you must first format the drive to match the console’s specific requirements. While older updates limited USB storage to 32 GB, modern firmware supports up to of external storage. 1. Best USB Drive Requirements