Microsoft’s facial-expression-capturing Xbox 360 add-on arrives free for all Xbox Live users for a limited time; Kinect Sparkler confirmed for July 28 debut.

Avatar Kinect lets up to seven users congregate in virtual chat rooms as their Xbox 360 avatars. The Kinect tracks the users’ movements–from nodding heads to raising eyebrows–and maps them to their digital counterparts. The application also lets users set their chats against two dozen different backdrops, as well as record and edit video clips of the conversations to share with others.

Until September 8, Avatar Kinect will be free for all Xbox Live users. After that, only Gold subscribers will be given complimentary access to the service.

Microsoft also dated another Kinect utility today, revealing that Kinect Sparkler would launch July 28. The digital toy lets players use their fingers as virtual sparklers, painting a canvas with multicolored fireworks in three dimensions. Like Avatar Kinect, Kinect Sparkler will also have a means to save and share creations with others. When it launches, Kinect Sparkler will sell for 240 Microsoft points ($3).