Researchers at the University of Southern California Institute for Creative Technologies have software that enables PC games to work with Microsoft's Kinect sensor. The software is called Flexible Action and Articulated Skeleton Toolkit (FAAST). It apparently emulates custom configured keyboard controls that are activated by body movements.
The most interesting part about this software can be seen in the video embedded in this story - it shows researchers playing World of Warcraft using the Kinect and the toolkit.
While the software is interesting for games, it may have other more practical uses such as "active gaming" to fight childhood obesity or "motor rehabilitation" for stoke victims.
Check out the video. For a technical overview of the software, check out ict.usc.edu.