How to Create a Virtual Machine: A Step-by-Step Guide

A virtual machine (VM) lets you run a completely separate operating system inside your current one — no extra hardware required. Whether you want to test software safely, run a different OS, or build a development environment, knowing how to set one up correctly makes a real difference in how well it performs.

What a Virtual Machine Actually Does

A VM is a software-based computer. It borrows resources — CPU cycles, RAM, and storage — from your physical machine (called the host) and uses them to run a simulated computer (called the guest). The guest OS has no idea it's running on virtual hardware; it behaves like it's on a real machine.

This is made possible by a piece of software called a hypervisor. There are two types:

• Type 1 (bare-metal): Runs directly on the hardware, no host OS underneath. Common in enterprise environments (examples include VMware ESXi and Microsoft Hyper-V in server configurations).
• Type 2 (hosted): Runs as an application on top of your existing OS. This is what most desktop users work with — software like VirtualBox, VMware Workstation, or Parallels Desktop falls into this category.

For most home and professional desktop use, a Type 2 hypervisor is where you'll start.

What You Need Before You Begin

Before creating any VM, your hardware and software need to meet a few baseline requirements.

Hardware Requirements

Virtualization support must be enabled in your system's BIOS or UEFI settings. Most modern processors support it, but it's sometimes disabled by default. You can verify this in Task Manager (Windows) under the Performance tab — look for "Virtualization: Enabled."

Software Requirements

• A Type 2 hypervisor installed on your host machine
• An ISO file of the guest operating system you want to install (downloaded from the official OS source)
• Adequate disk space for both the VM disk image and any snapshots you plan to take

How to Create a Virtual Machine: The General Process

While specific steps vary by hypervisor, the core workflow is consistent across most tools.

Step 1: Install Your Hypervisor

Download and install your chosen hypervisor on the host machine. VirtualBox is free and cross-platform (Windows, macOS, Linux). VMware Workstation Pro is a paid option with more advanced features. Parallels Desktop is macOS-specific and optimized for running Windows on Mac hardware, including Apple Silicon.

Step 2: Create a New Virtual Machine

Open the hypervisor and select "New" or "Create Virtual Machine." You'll be prompted to:

• Name the VM — choose something descriptive
• Select the guest OS type and version — this helps the hypervisor apply sensible default settings
• Allocate RAM — a general starting point is dedicating no more than half your host's total RAM to the guest
• Create a virtual hard disk — typically a dynamically allocated file that grows as needed, or a fixed-size disk for more predictable performance

Step 3: Attach the ISO and Install the OS 💿

In the VM's storage settings, attach your ISO file as a virtual optical drive. Start the VM — it will boot from the ISO just like a real machine booting from a disc. Follow the OS installation process as you normally would.

Step 4: Install Guest Additions or VMware Tools

After installing the guest OS, install the hypervisor's companion software:

• VirtualBox Guest Additions
• VMware Tools

These packages improve display resolution, enable clipboard sharing between host and guest, optimize mouse integration, and significantly improve overall VM performance. Skipping this step is one of the most common reasons new VMs feel sluggish or unresponsive.

Step 5: Configure Networking

By default, most hypervisors set the VM to use NAT (Network Address Translation), which gives the guest internet access through the host's connection without being directly visible on the local network. Other options include:

• Bridged networking — the guest gets its own IP address on the local network, appearing as a separate device
• Host-only networking — the guest can only communicate with the host, useful for isolated testing

Snapshots: One of the Most Useful VM Features 📸

Before making major changes to a VM — installing software, testing configurations — take a snapshot. A snapshot saves the exact state of the VM at that moment. If something breaks, you restore the snapshot and you're back to where you started. This is one of the biggest practical advantages of using VMs over bare-metal installations.

Factors That Shape Your Experience

Even with the same hypervisor, two people can have very different results. The variables that matter most:

• Host machine specs — a VM on a machine with an NVMe SSD and 32 GB RAM performs dramatically differently than one on a spinning hard drive with 8 GB
• Allocated resources — over-allocating RAM or CPU to the guest can throttle the host; under-allocating makes the guest sluggish
• Guest OS choice — lightweight Linux distributions demand far fewer resources than Windows 11
• Use case — a VM for basic web browsing has different needs than one running a local development server or a graphics-intensive application
• Host OS — macOS on Apple Silicon adds a layer of complexity around CPU architecture that affects which guest OSes run natively versus through emulation

How much of your system resources you can spare, what you're trying to run inside the VM, and how much performance you actually need — those specifics belong to your setup, not any general guide.