Microsoft’s Xbox 360 cemented its position as the undisputed champion of the U.S. game console industry in 2011 with December sales of 1.7 million units — putting the company atop of the market for the twelfth straight month.

For the full year, the NPD Group market research firm says the Xbox 360 platform was responsible for 40 percent of retail sales in physical stores across all categories, including hardware software and accessories. In terms of hardware sales, NPD described the PlayStation 3 and Nintendo Wii as “neck and neck in second place” for the full year.

It was a rough year for the industry overall — registering $17 billion in physical retail sales, a decline of 8 percent from 2010, according to the NPD data.

On a worldwide basis, Microsoft this week reported that it has sold more than 66 million Xbox 360s since the console launched. Nintendo is still the overall leader of the current console generation, with more than 90 million Wiis sold globally, but that came largely as a result of the early popularity of the Nintendo console, which has since waned.