This happened two days ago after months of never having an issues. I have the black N-Wireless XBOX 360 adapter (microsoft adapter)...it has worked fine until the other night, I got booted during a game.
After checking it out, the green light that normally stays solid was blinking green. According to this site, that means it is searching for a wireless network.
I went to the dashboard and signed again, but could not. I then was led to the "Test Connection", which I tried. The message I receive when i try to test the connection is "To use a wireless internet connection, connect an XBOX 360 wireless networking adapter to your console."
Well, it is connected, and blinking. I rebooted, it worked for a bit, then stopped again.
I called xbox and went through the whole reboot everything (modem, router, xbox, etc.) then restored networking settings to default, and started over.
it worked for 10 minutes, then died again.
called Xbox back last night, and they said it could be the console, could be the adapter, or could be the USB ports.
I tried the USB ports with a charger for a controller, and also a thumb drive, and both worked.
The xbox works fine, plays the games, etc. It would seem to be that something went wrong in the wireless adapter, but it will still work if you start everything over, but only for a few minutes before blinking again.