The so-called 'stay-at-home' server is touted as a consumer friendly platform that acts as a hub for networked PCs and other domestic media devices.
Windows Home Server automatically backs up XP- and Vista-based home computers each night, and provides a central place to organise digital documents and media.
The software includes a free Windows Live Internet address to access the home server via the web.
It also monitors the health and security status of home computers and can stream media to other devices in the home, such as an Xbox 360.
"Digital devices and content are everywhere in our day-to-day lives and are more important all the time," said Microsoft chairman Bill Gates.
"With the launch of Windows Home Server, Microsoft and its partners are creating a new consumer product category."
The HP MediaSmart Server is powered by AMD's Live technology, and is offered in a 500GB version for $599 and a 1TB model for $749.
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