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A nested VM (nested virtual machine) is a virtual machine contained within another VM.
Nested VMs are used for testing out hypervisors and new operating systems in lab environments. Administrators using one hypervisor can nest a competitive hypervisor to try its features. Nested hypervisors also can support cloud deployments, nesting the specific hypervisor required for VM images on the user's hypervisor.
The nested VM does not interface directly with the underlying physical hardware. Older VMware hypervisor architectures, such as Workstation 7, do not support nested VMs that require hardware-assisted virtualization. Nested virtual machines on VMware hypervisors also have networking, official support and VMware vMotion limitations to consider.
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