Basically calling Halo 3 gay. The game is usually overrun by noobs and assholes in the matchmaking and has really crappy shot registration. The term is used to make fun of the game for that matter.
*In an xbox live party*

Gamer 1: I'm bored... Wanna play halo?

Gamer 2: Sure. Let me just find my Gaylo 3 disc...

Gamer 1: hahahahahah
by JustaN00B June 27, 2009
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