What movie formats can I play on Xbox 360?

According to Microsoft's support page, you can use the following codecs when streaming from USB: WMV(Unprotected), Mpeg4, H.264, AVI.

Further investigation of that same page reveals that that means you can use the following file formats: avi, .divx, .mp4, .m4v, mp4v, .mov, .wmv

Also, when playing something from USB, the file can be no larger than 4 GB. It also cannot play DivX files older than DivX 5.0.