The prototype controller was developed by Gregory Kovacs, a professor of electrical engineering at Stanford University, in collaboration with Texas Instruments.
The main area of research by grad students in Kovacs' lab involves developing practical ways of measuring physiological signals to determine how a person's bodily systems are functioning.
Corey McCall, a doctoral candidate in Kovacs' lab, popped the back panel off an Xbox 360 controller and replaced it with a 3-D printed plastic module packed with sensors to develop the prototype.
Another light-operated sensor gives a second heart rate measurement, and accelerometers measure how frantically the person is shaking the controller.
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A custom-built software gauges the intensity of the game - a simple but fast-paced racing game in which the player must drive over coloured tiles in a particular sequence.
McCall can then compare all this data to generate an overall picture of the player's level of mental engagement.
The controller can provide feedback to the gaming console, which can then alter the pace of gameplay to better suit the player.
"We can also control the game for children. If parents are concerned that their children are getting too wrapped up in the game, we can tone it down or remind them that it's time for a healthy break," he said.
The controller was presented at the International Consumer Electronics Show in Las Vegas in January.