The deal, brokered by Claudia Lagunas, head of international marketing for PepsiCo, is Pepsi's largest online commercial partnership to date.
The campaign will run for nine months and will initially include a Pepsi Max microsite in the UK, Norway and Australia targeting 18 to 25-year-old men.
The Pepsi Max's "Club" microsite has been built and is being hosted using Microsoft technology.
Fronted by Australian soap Neighbours pin-up Holly Valance, it aims to engage users with the brand by allowing them to share comments, games and photo galleries with friends on social networking sites such as Facebook and Twitter, encouraging them to join Pepsi Max's Club.
Microsoft's portal MSN will host specially created editorial content, which Microsoft has guaranteed will drive at least one million people to the microsite.
Microsoft Advertising will also drive consumers to the microsite through ads around its MSN Messenger service.
Bruno Gruwez, marketing director UK Beverages at PepsiCo, said: "We wanted to make sure we were in the digital space as that's where our consumers are and we will continue to increase investment in the digital space.
"The deal with Microsoft is a way of adding value and we will continue to expand our partnership with them."
