In its response, Activision said a huge demand for the service since launch had contributed to significant issues with the availability of certain features.
The company also stated that the inherent technical difficulty involved in making Elite available on a range of devices and platforms also added to these problems.
"Despite extensive beta testing and two years in development, many users had experienced technical issues with the Elite service at launch," Activision said.
The complainant specifically named four features of the Elite service which couldn't be accessed: the daily competitive program guide, exclusive clan benefits, joining premium groups and the premium theatre.
Activision said the problems with the service had been well publicised and it had announced that all premium Elite members would have their membership extended for 30 days free of charge to make up for the problems.
It also claimed that one of the key value propositions of premium Elite - downloadable content at a reduced bundled price - had not been impacted by the launch issues.
At the time of the ASA enquiries in February 2012 three of the services were operational and one had been "withdrawn on editorial grounds".
The ASA noted in its judgement that since its launch the Elite service had been subject to a very large demand and that this had contributed to registration and availability problems for some of the Elite features.
The watchdog also acknowledged that Elite ran on several platforms, which involved inherent technical complexity.
However, because the marketing material about the service had not been amended to warn new subscribers about the problems the ASA upheld the complaint.
"We noted that Activision had communicated the technical issues through other channels including online updates, the official Twitter feed and interviews with the specialist gaming press. However, we considered that Activision should have taken timely action to alert potential consumers to the operational problems at Elite by amending the marketing material in question," the ruling said.
"Because they had not done so we considered that the restrictions on the availability of the product features had not been made sufficiently clear."
Activision was judged to have breached CAP Code rules on misleading advertising and availability. The ASA told the games company to ensure that marketing material was accurate in respect of availability of product features.