Free Virtualization Software
One of the biggest obstacles to overcome in setting up a virtualized environment has traditionally been obtaining virtualization software. Thankfully, a variety of free virtualization programs are now available, taking the financial sting out of virtualization.
For Windows 7
Figure 7 Configuring a new virtual machine for use with Windows Vista using Windows Virtual PC
Windows 7, Windows Vista, or Windows XP
Windows 7 users whose systems don't support hardware virtualization can download Virtual PC 2007, which also works with Windows Vista and Windows XP.
Comparing Virtualization Programs
Microsoft compares Windows Virtual PC and Virtual PC 2007 here.
Labnol's comparison of Windows Virtual PC, Virtual PC 2007, WMware Player 3.0, and VirtualBox 3.0 is available here.