Turn on the Xbox 360 while holding A to remove old cache files from the hard drive. Note: Your saved games an media will be intact, however downloaded game updates will be deleted. They can be restored by playing the game again while Xbox Live enabled.

Alternately if your system had the Spring 2006 patch installed, enter the "System" menu. Select the "Memory" option. Highlight the hard drive, then press Y. The Device Options screen for the hard drive will appear, with "Rename" and "Format" options. Press X(2), LB(2), X(2) to clear the cache.