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Rockstar has finally enabled the upgrade path for Red Dead Redemption from Xbox 360 all the way up to Xbox Series X|S.

They shared this message earlier today:
The issue preventing Xbox players from upgrading their digital Xbox 360 version of Red Dead Redemption to the Series X|S version has been resolved. Thank you for your patience.
Why Did This Mix-Up Even Happen?
Rockstar partly created some of the mix-up around Red Dead Redemption’s upgrade path for Xbox. When the new upgraded version launched, some Rockstar customer agents allegedly said that the upgrade path doesn’t exist at all.
So to clear things up, the Xbox “Backwards Compatibility” Digital version of the game is actually the Xbox 360 version, with some upgrades for Xbox One.
If you have the Xbox 360 disc version of the game, you can play it on Xbox One, and Xbox Series X|S. Both consoles will upgrade the game using the same backwards compatibility enhancements.
However, as explained in this Rockstar support article, The Xbox 360 disc version cannot be upgraded to the Xbox Series X|S version.
There was a direct upgrade path so that if you bought a digital copy of the game on Xbox 360, you can upgrade it to the new Xbox Series X|S version now. There was a technical issue to avail of this upgrade, but those Xbox users who had this copy digitally were eligible for it all along.
Xbox Gamers Won Out In The End
Ultimately, if you played this game on Xbox 360, you got the best deal from Rockstar Games and Microsoft. If you bought it digitally, you kept getting updated for all these years.
If you got a disc copy of Red Dead Redemption, you got the upgrade up to Xbox One. While it isn’t ideal, it’s still better than what PlayStation 3 gamers got.
Whether you got Red Dead Redemption on PlayStation 3 on disc or digitally, Rockstar did not give gamers an upgrade path. And this ultimately is on Sony, because of the technical choices they made on that console.
If you’re a Nintendo gamer, or even a mobile gamer, you’re only getting a chance to play this game just now. Nintendo gamers got their upgrade path from Switch to Switch 2. But since the two versions are months apart instead of years, it’s more of a nice bonus.
Xbox gamers got the real value out of their copies that lasted decades. And to cap it off, if you did have the Xbox 360 disc version, or hadn’t bought the game yet, the Xbox Series X|S version is still half-off until the end of this week on the Xbox Store.
