There has been news reports that Microsoft’s Windows Vista Home Basic and Premium editions are not allowed to run under virtual machines. The limitation is found under the end-user license agreement of the software.

Those who download the softare from MSDN do not have this limitation. It only applies to those that will buy the software in retail stores and for OEM licenses.

One of the reasons why Microsoft has included the limitation may be that they want users to buy the other, more expesive editions of Vista.