Server virtualization, also known as hardware virtualization, is a hot topic in the IT world because of the potential for serious economic benefits. Server virtualization enables multiple operating systems to run on a single physical machine as virtual machines (VMs). With server virtualization, you can consolidate workloads across multiple underutilized server machines onto a smaller number of machines. Fewer physical machines can lead to reduced costs through lower hardware, energy, and management overhead, plus the creation of a more dynamic IT infrastructure.
With Windows Server 2008, everything needed to support server virtualization is available as an integral feature of the operating system—Windows Server 2008 Hyper-V.
With Hyper-V, the next-generation hypervisor-based server virtualization technology, as a role, plus flexible licensing policies, it's now easier than ever to take advantage of the cost savings of virtualization through Windows Server 2008. This enables you to make the best use of your server hardware investments by consolidating multiple server roles as separate virtual machines (VMs) running on a single physical machine and also efficiently run multiple different operating systems—Windows, Linux, and others—in parallel, on a single server, and fully leverage the power of x64 computing.
please visit Microsofts Virtualization TechCenter