We report results obtained from analysis of the XMM-Newton observation of the compact group of galaxies HCG 16 . It is a peculiar system composed of 7 spirals , 6 of which are active , and its nature as a bound system has been much debated . The EPIC camera observations give new insights into the X-ray parameters describing the physical status of the group . We detect diffuse X-ray emission with a rather elliptical morphology which extends to at least a radius of 135 h ^ { -1 } _ { 50 } kpc from the group centre . The spectrum within this region is well modelled by a thermal plasma with a temperature of 0.49 \pm 0.17 keV , and a non-zero metallicity . We measure a bolometric X-ray luminosity of 9.6 \times 10 ^ { 40 } h ^ { -2 } _ { 50 } erg s ^ { -1 } which may be only a small fraction of the total luminosity because of the limit in spatial detection arising from the high background level . Despite its low temperature and luminosity , HCG 16 obeys the L _ { X } - T relation obtained for brighter galaxy groups even if it lies in a very extreme position . The properties of the diffuse emission confirm the bound nature of HCG 16 even if the gas trapped in the potential well may not yet be virialized . This reopens the debate about the real nature of spiral-dominated galaxy groups , and on their role in a more general cosmological context .