The teenager explained to police that he used his games console to view the explicit material before he "decided to try it out", targeting his sister because she was "small" and "couldn't remember stuff".
The boy, who cannot be named for legal reasons, pleaded guilty at Blackburn Magistrates Court and has been bailed to live with relatives away from his sister while a pre-sentence is prepared.
Fiona Elvines, a spokeswoman for the charity Rape Crisis, explained that children accessing pornography is a "growing concern":
"This is going to completely destabilise this little girl’s life.
"It will take her a very long time to try and work through. It will have put her life on a different track and I do not want that to happen to anybody else.
"When children see porn, they have no context for what it is used for. There is pressure on children to be sexualised, particularly on younger boys, to start having sex"
Speaking with The Lancashire Telegraph, she continued: "For a long time, people have been sitting on the fence and saying we do not have the evidence to say porn is harmful, but now we are starting to have some evidence around young people’s exposure.
"How much evidence do you need? It shows that the government’s measures are extremely important and that we need to start acting.
"When children see porn, they have no context for what it is used for. There is pressure on children to be sexualised, particularly on younger boys, to start having sex.
"It is coming from peers and porn."
Microsoft, the company which makes the X-Box, have expressed their sympathy for all involved in the case, but urged other parents to take note of what has happened and review the settings on their children's consoles:
"At Microsoft we have some of the most robust systems that allow parents to control what their children play and watch online.
"For example, access to the internet is switched off automatically for all child accounts on X-box, and we urge parents to review the settings on their children’s consoles."