What Is Teredo?
Teredo is short for Teredo tunneling, in this context.
That way, it can translate smoothly between the two protocols, allowing them to share data.

Microsoft
What Does ‘Teredo Is Unable to Qualify’ Mean?
This error means that the Xbox was unable to secure a Teredo IP address.
In other words, it’s unable to determine where it should send internet traffic.
When Does My Xbox Use Teredo?
Teredo tunneling is only used for in-game chat and online multiplayer features.
How Do I Determine If My Xbox Is Using Teredo?
These are two separate IP addresses; if there’s no IPv6 connection, then you are on IPv4.
If you have an IPv6 connection, it connects directly.
Here are some things that might help:
Determine if the router is Windows-certified.
This information should be on the router’s box or in its documentation.
A non-certifiedroutermay lack the software to balance multiple consoles for Teredo properly.
Reboot the modem and router.
Connect the Xbox directly to the modem or router.
If you use a gateway orWi-Fiextender, connect the console directly to the modem or router instead.
This increases signal speed, making qualification easier.
It also helps narrow down the possible point of failure.
Connect through an Ethernet cable.
A wireless interference could be slower than the actual internet speed.
Connecting through anEthernet cableallows devices to take full advantage of the connection.
Check the router for a firmware update.
Firmware often contains useful improvements to processes across a unit, including tunneling.
It’s also a good idea to check the console for an update.
If you use a virtual private connection to dive into the internet, disable it and attempt to reconnect.
VPNs may interfere with providing login credentials or with the tunneling process.
Reset the router to factory configs.
Check the IP address.
If the addresses match, it’s a public IP address.
If they don’t, request one from your internet service provider.
Check the web connection Address Translation table.
Disable and re-enableUniversal Plug and Play(UpnP) on the router.
Then, restart the console and hold theXboxbutton to launch the guide.
Go toSystem>controls>General>connection settingsand check the connection Address Translation (NAT) table.
Set it toOpenif it isn’t already.
Open ports for use by port forwarding on the router.
Choosing specific ports may help the tunneling process.
SelectDNS Setting>Manualand enter the primary DNS and secondary DNS, if available.
Enable DMZ or perimeter data pipe controls on the router.
This allows more access to public IPs.
Connect the Xbox directly to the modem using an Ethernet cable.
If all else fails, cutting the router out of the equation may fix the issue.
What Causes the Xbox Teredo Error?
Xbox Teredo errors are usually connection errors that masquerade as something more complicated.