As speculated, Microsoft today unveiled the long rumored motion-sensing device for its Xbox 360 console that will allow players to control games with the movement of their bodies. Dubbed Project Natal, the new accessory consists of a camera, depth sensor and multi-array microphone that can track full body movements, recognize facial expressions and even voice commands.

The company hopes to emulate the success of Nintendo’s Wii, without the need for a controller, noting that Project Natal will offer more than just a set of “preset waggle commands.” You can use the system to control your Xbox Live avatar, navigate through the Xbox 360’s dashboard using gestures captured by the camera, and control games specifically designed for the device – development kits are said to be going out today. It might be a while before this motion-sensing bar hits the market, but Microsoft is nonetheless teasing us with a short video demonstrating how the system could be used to control games.

The announcement was made at the company’s E3 press conference, where Microsoft also unveiled a number of exclusive titles and the ability to access social networking sites Facebook and Twitter as well as streaming music service Last.fm on the Xbox Live service.