Currently, Xbox LIVE members may experience issues related to billing. That means difficulties with account recovery, account management, Marketplace functions and/or making purchases. Users who already have Microsoft Points in their account will be able to redeem them. Until these issues are resolved, you will also be unable to sign in to Xbox.com, which includes posting in the forums and queuing up downloads on the Marketplace. All other areas of LIVE (matchmaking, friends lists, messaging etc.) are not affected.
The engineers are actively working to resolve the issues as quickly as possible. Keep an eye on the Xbox LIVE Status page in the support section of Xbox.com which will be updated when conditions change.
Thanks for your patience.
Update: The above issues have been fixed.