From Halopedia, the Halo wiki
The arm glitch, commonly known as the eXo arm glitch, is a Halo 3 animation glitch that can cause a player's arms to bend erratically, sometimes even causing them to (seemingly) vanish. The glitch was discovered by and named after the eXo clan.
The glitch occurs when two players, during a Forge session, try to pick up the same weapon at the same time, with one (Person A) in Edit Mode and the other (Person B) in Player Mode. Person B's arms or weapon will bend or vanish depending on what weapon is used.
Different weapons cause different bends and have different effects when used. If, for example, the glitch was performed with a Sentinel beam or a Gravity Hammer, then Person B's arms would blow off when they attempted to fire the weapons. Furthermore, if Person A were to then delete the weapon, Person B would be left with only one arm, and would be invulnerable.
If the weapon was a standard projectile weapon, and if Person B were to fire that weapon, then the resulting projectile may not originate from Person B. That is to say, if Person B were to fire, say, a Plasma Pistol at a hypothetical Person C, then the shot may end up appearing on the opposite side of the map. In such a case, Person C would not be able to reliably locate the source of the projectile, making the glitch useful for sniping and other stealth-related purposes. In some cases, no visible projectiles may be produced at all, but Person C may still take damage.
If Person B were to be assassinated after execution of the glitch, the screen would begin to lag, and Person B's corpse would begin to hover and move through the air; upon hitting the wall, the corpse would then exhibit strange behaviors (changing color, body parts disappearing, etc.) until it vanished.
Nuclear bomb glitch
There is a very powerful sub-glitch of the arm glitch, known as the Nuclear bomb glitch. The sub-glitch turns a Gravity Hammer into an extremely powerful weapon.
- If you use a Spartan Laser in this glitch and aim it at someone's face, they will see the targeting beam coming down from above, outside the game boundaries.
- YouTube: Halo 3 Glitches and Tricks - Soulja Boy and Touchdown Poses How to enter a "Soulja Boy" pose using this glitch.
- YouTube: Halo 3 Glitches and Tricks - eXo Arm Tutorial
- Bungie.Net: Wait, what? A rendered clip of a player being assassinated during this glitch.