The PlayStation3 - previously considered unhackable - has been modified to run pirated software by an American who unlocked the original iPhone.
George Hotz told the BBC that he's beaten the PlayStation 3's piracy protection with a combination of hardware and software modifications.
The high-profile hacker admits that he hasn't hacked the whole system and its protected memory, but says he's tricked the console into doing what he wants it to.
"It's supposed to be unhackable - but nothing is unhackable," 20-year-old Hotz told BBC News.
"I can now do whatever I want with the system. It's like I've got an awesome new power - I'm just not sure how to wield it."
He says he will publish the technique - which took five weeks of work - in a similar fashion to his iPhone 'jailbreak' from 2007.
Hotz describes the hack on the "very secure system" as five per cent hardware, 95 oer cent software.
"You can use hardware to inject an insecurity and then you can build on that," he said.
He will also publish detail of the PlayStation's 'root key', which will allow others to attempt alternative hacks on the entertainment device.
The exploit will also allow PS2 games to be played on the console, Hotz said. Early PlayStation 3s were able to run these titles, but controversial hardware changes in the console removed the ability.
Sony has not yet released a statement about Hotz's claims, but BBC reported that the company was investigating reports before commenting.
It is not yet clear what modifying the consoles could mean for users. Microsoft last year kicked thousands off its Xbox Live online gaming service for running modded Xbox 360s.
"This would also be a good time to remind you that the warranty on an Xbox 360 console is not transferable and if you purchase a used console that has been previously banned, you will not be able to connect to Xbox LIVE."
Sony may take similar action with hacked PlayStation3s using its similar service, PlayStation Network.