There are many possible explanations as to why a Xbox 360 headset might not work. Probable causes range from a faulty headset, family configurations, a dusty connection port or cross-platform usage.
To ascertain what the issue is, start by inspecting the headset for visible defects. Afterwards, clean the headset connection port using rubbing alcohol and a cotton swab. Make sure the controller is on and working, and then plug the headset into the connection port underneath the directional pad.
Next, test the headset by recording a message. Press the Xbox Guide button on the controller, and using the A button, select Messages. Select Create New then select Messages. Choose a Gamertag and then select Add Voice. With your headset now plugged in, select the Record symbol and speak closely and clearly into the microphone for at least 5 seconds. Select the Stop button to end the recording then select the Play button. If you can hear your message back, your headset is functioning properly.
The family settings might also be blocking the sound on Xbox Live. Change this by logging into Xbox Live with the account experiencing issues and click on Privacy Settings. Click on Change Settings, then Customize, and then under Activity, click Voice and Text then choose Friends Only or Everyone.