The NSA and GCHQ monitored the activities of gamers using popular platforms and titles such as Xbox Live and World of Warcraft (WoW) during their PRISM operations, according to the Guardian.
The Guardian reported uncovering the spy campaign in a document leaked to the paper by ex-CIA contractor Edward Snowden.
The document, codenamed Exploiting Terrorist Use of Games and Virtual Environments, was reportedly written in 2008 and details how the two agencies had taken vast amounts of data from the Xbox Live network's 48 million users.
The document also showed the NSA and GCHQ had sent "real life agents" into popular massive multiplayer environments, including WoW, to recruit informants to help find terrorists playing the games.
A spokesman from Blizzard Entertainment, the company that made WoW, told V3: "We are unaware of any surveillance taking place. If it was, it would have been done without our knowledge or permission."
A Microsoft spokesperson mirrored Blizzard's statement, confirming to V3: "We're not aware of any surveillance activity. If it has occurred as reported, it certainly wasn't done with our consent."
Microsoft was one of the companies highlighted in the original PRISM scandal, when Snowden leaked documents to the press revealing that the NSA is siphoning vast amounts of web data from numerous technology companies.
GCHQ is known to have used PRISM data in some of its operations. The Intelligence and Security Committee (ISC) has since ruled that GCHQ's involvement in the PRISM programme was entirely legal.
Microsoft, Apple, Facebook, Google, LinkedIn, Yahoo, AOL and Twitter signed a joint letter addressed to the US president and congress demanding that they change the country's law to block operations such as PRISM earlier this week.
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