Windows XP Mode, one of the most hyped features of Windows 7, was designed to integrate XP with Windows 7 so that you can run XP applications from directly inside Windows 7. Microsoft has touted the feature for small businesses that need to run XP applications but want to upgrade to Windows 7. Those businesses may indeed want to use it -- but for many consumers, the problems with Windows XP Mode will likely outweigh its benefits.
Can your PC handle Windows XP Mode?
Here's the first piece of bad news: Your PC may not be able to handle Windows XP Mode, even if you've just bought a new machine.
XP Mode requires that your CPU be capable of hardware virtualization using either Intel Virtualization Technology (VT) for Intel chips or AMD-V for AMD chips. You might assume that if you've got a multicore PC, it can certainly do that. However, that's not necessarily the case.
Even some quad-core CPUs, such as the Intel Core 2 Quad Q8400, don't have virtualization technology built in. And to make things more confusing, some older, less powerful and less expensive CPUs, such as the Intel Core Duo T2400, do have the technology.
Both Intel and AMD have utilities you can download that will let you know if your PC has that support. You can use either the AMD Virtualization Compatibility Check Utility (which checks whether your processor supports AMD-V) or the Intel Processor Identification Utility (which is a more comprehensive checking tool).
If your processor doesn't support either technology, you can stop reading now -- you're out of luck. However, even if the CPU does support it, you're still not out of the woods.
Hardware virtualization is turned off by default on many PCs. There's no clear reason why that is, although according to Microsoft, there are potential security issues with hardware virtualization.
You'll need to check your system BIOS to find out whether your hardware virtualization is turned on; if it's not, you'll have to turn it on. How you do that varies according to system manufacturer and even model, so check with your manufacturer. (Microsoft offers sample instructions for Dell, HP and Lenovo.)
For example, on my Dell, I rebooted and pressed the F12 key as the system restarted to get into the BIOS setup. At first, I couldn't find an option for virtualization support, but after nosing around, I finally discovered it in a very odd place -- in the POST behavior area. I enabled it and let the PC boot.
Make sure to turn off your PC after changing the BIOS, to put the new setting into effect. It's also good idea to get back into the BIOS when you reboot and see whether the new setting took.
Installing and running Windows XP Mode
Finished? You're finally ready to install Windows XP Mode.
You need to download and install two (currently beta) apps: Windows Virtual PC and Windows XP Mode. Windows Virtual PC is the newest version of Microsoft's Virtual PC, and Windows XP Mode is essentially a precreated virtual machine for XP designed to run in Windows 7. You won't have to pay for a separate license for XP.
Installation is straightforward: Windows Virtual PC first, and then Windows XP Mode. At the end of the installation process, you'll go through the usual setup routine for a new copy of Windows, including questions such as how to handle Automatic Updates and so on. And you're done.