As of August 13, Microsoft is previewing a new compact mode for the Xbox Game Bar in Windows. That might not sound earth-shattering at first, but it’s actually a spearhead in the company’s plans to make Windows more friendly forhandheld gaming PCs, such as theASUS ROG Ally. In fact, should things pan out, it could prove a threat to the dominance of the ValveSteam Deck, which is based on SteamOS.
Here we’ll explain what compact mode is, how it works, and why it might eventually reshape the handheld PC landscape. Don’t worry – keeping with the theme, we’ll try to be brief.

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What is compact mode?
Making your handheld PC feel more functional
Compact mode modifies the Xbox Game Bar interface in Windows 11 to be more convenient on handhelds. For instance, you use bumper controls to cycle through “widgets,” Microsoft’s term for tabs like your library and settings. The interface as a whole is friendlier to analog/D-pad control, and redesigned to fit on the smaller displays handhelds use.
The centerpiece of Compact Mode is the Home widget, where you’ll see active and recently played games, as well as launchers for third-party services like Steam and Battle.net. you’re able to also use the widget to exit games by selecting the appropriateClosebutton, which may be faster than exiting via in-game menus.

Something interesting is that you can not only customize each widget, but download additional ones from a Widget Store. Some of the available widgets so far include Audio, Capture, Gallery, Performance, Resources, and Xbox Social. If you don’t need an installed widget, you can remove it from the menu bar.
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How do you activate Compact Mode?
The first step is becoming an insider
The first step is signing up for theXbox Insiders Program. For that you’ll need to download theXbox Insider HubWindows app, which grants early access to upcoming features. Expect to be prompted for feedback, since the point of the Insider program is to help engineers improve their software.
To turn on Compact Mode, go to the regular Game BarSettingswidget, selectGeneral, then flip theCompact Modetoggle. You’ll also have to map theWin + Gkeyboard shortcut to a button, assuming your handheld supports that. If it doesn’t, there’s not much point in using the Game Bar over other launchers, since you may not be able to switch to it mid-game without an external keyboard or returning to the Windows desktop.

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Why is Compact Mode a big deal?
Competition with the Steam Deck could be on the horizon
Because Windows 11 hasn’t had a handheld UI until now, gamers have often had to use the custom overlays created by hardware makers, or else struggle with the Windows desktop. Those overlays can be flawed, and the Windows desktop is always less than ideal on a 7- or 8-inch touchscreen. you may, naturally, connect a mouse and keyboard for improved control, but that negates portability.
The great advantage of the Steam Deck so far has been its simplicity. It boots straight into a purpose-built interface, making it feel like aNintendo Switch. There’s no worry about how to launch or download games, and if you really need it, there’s still a desktop mode – it’s just Linux-based, so you may need to jump through hoops to run some Windows apps.

Compact mode should in theory bring some of the Steam Deck’s convenience to native Windows gaming, reducing or eliminating the need for custom overlays. More importantly, it could make a console-like experience commonplace, increasing the appeal of handheld PCs among more casual audiences. Long-term, that would foster more competition with Valve, ideally accelerating the evolution of the industry.
It’d be premature to say that’s where we’re headed, of course. We’ll need to test compact mode for a while to see how well it works, and since it’s in a preview state, it may not even look the same by the time it’s rolled out to Windows in general. Handheld PCs additionally need a better way of accessing and controlling non-gaming apps – the Xbox Game Bar isn’t built for things like Chrome or Spotify, much less Photoshop or Word. We’ll have to see if Microsoft can solve that dilemma.

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