The service is due to launch officially in six months
Microsoft is aiming to capitalise on the user-generated video phenomenon by launching an online service to compete with YouTube, Google and Yahoo.
Soapbox starts testing on Tuesday and will launch within six months as part of current service, MSN Video.
YouTube had 34 million visitors last month, according to Nielsen/NetRatings, while MSN Video attracts about 12m.
The video-sharing market has proved increasingly popular with users in the last 12 months with services such as YouTube crossing over into mainstream success.
MSN Video was once the most popular video site until fans of user-generated content propelled YouTube, MySpace and Google past Microsoft.
MySpace video receives 17.9 million visitors a month and Google Video attracts 13.5 million each month, according to Nielsen.
Microsoft is jumping on this bandwagon with some uncertainty
Joe Wilcox, Jupiter Research
The testing period is by invitation only although users are encouraged to apply for invitation on the website.
However, the site was hit by a technical problem on Tuesday which told users: "Oops. It's not anything you did - it's us. Our site's down. Please try again later."
Microsoft has said it will take down any copyrighted material uploaded by users without permission once it is alerted by the rights holder.
The firm said the service would work with users of computers running both Windows and Apple operating systems and would support browsers including Internet Explorer, Firefox and Safari.
Soapbox will also support a number of video file formats and delivery methods, according to Microsoft.