Yes, to hack an Xbox 360, you usually need to take apart the console and modify it. This involves changing hardware and software Settings to enable it to run unlicensed software and games.
Dismantling allows the user to access the motherboard and internal components in order to install a cracked chip or software. However, disassembly may void the warranty and damage the host machine under incorrect operation, so users should fully understand the risks and take appropriate precautions before performing disassembly cracking.
In some cases, there may be a non-rip cracking method available, but this depends on the specific Xbox 360 model and cracking technique.