The error in Grand Theft Auto IV occurs because the game relies on the defunct Games for Windows Live (GFWL) service. To fix it, you can either install the official GFWL client or use a "xliveless" mod to bypass the requirement entirely. Primary Fix: Use XLiveLess (Recommended)
: Open the archive and find the xlive.dll file. How to Fix Xlive.dll Error in GTA 4
If you want to try the official route or keep original functionality: The error in Grand Theft Auto IV occurs
: Open Command Prompt as Admin and run sfc /scannow to repair corrupted system files. How to Fix Xlive.dll Error in GTA 4
This is the most common community solution as it removes the dependency on the broken GFWL service.