How to use a VHD to dual-boot Windows 8 on a Windows 7 PC

Update, August 17, 2012: I have tested the steps in this article with the Windows 8 RTM code on multiple test systems and can confirm that everything works just as described here. 

My portable PC of choice these days is an ASUS Zenbook UX31E. It’s a wonderful little machine—light, fast, fun to use, and a great example of what’s right with the whole Ultrabook category.

I wanted to try Windows 8 on this machine, but I didn’t want to mess up a perfectly good Windows 7 installation. This is, after all, a machine I use for work, and Windows 8 is still a new operating system. Before I commit to it, I want to be sure everything works well.

See also:

• Surprise! What you can expect from Windows 8 RTM
• 8 things to do right away after you set up Windows 8
• How to get Windows 8 ahead of the general public

The Zenbook has a 128GB SSD, which is fine for a secondary work PC but not enough to split in half for a conventional dual-boot setup. And there's no way to upgrade that built-in drive. After a few milliseconds of thought, I rejected the idea of trying to shrink my existing disk partition so I could pull that off.

And then it struck me: Wait a minute. I can boot Windows 8 from a virtual hard disk on this machine! And 30 minutes later, that’s exactly what I was doing.

I still have a single SSD with a single partition. But this is what I see at startup:

The actual steps for creating a virtual hard disk (VHD) and installing Windows 8 on it are very simple. The hardest part, in my experience, is wrapping your mind around exactly how this procedure works. So in this post I’m going to explain everything in detail, in the clearest, simplest language I can. Follow along, and I am confident it will work for you too.

Disclaimer, right up front: This works for me. I’ve tested it on several PCs, and I’m confident enough to write about it. But I haven’t tested it on your hardware. You should make a complete backup of your PC (preferably as a system image) before you try the procedures I describe in this post. In fact, you should have a complete backup of your PC even if you don’t try this. OK?

First things first. To make this work, you need the following ingredients:

• A desktop or notebook PC running Windows 7 Ultimate or Enterprise (preferably 64-bit). The Boot from VHD feature does not work on other versions of Windows 7. If you’re running Windows 7 Home Premium or Professional, you can’t do this.
• Windows 8 installation media (32-bit or 64-bit). You can use any edition of Windows 8. If you have a DVD, use it. MSDN/TechNet subscribers can download ISO files from those sites. Microsoft makes a free 90-day trial version of Windows 8 Enterprise available as well. Get details about these options here.
• The Windows 7 USB/DVD download tool, which is available for download here. (Don’t let the name fool you—it works just fine with Windows 8.)
• A 4GB (or larger) USB flash drive or a DVD. I highly recommend using a USB flash drive as your installation media. It’s faster, and it works on any modern PC.
• At least 20GB of free space on a local hard disk or SSD. If you plan to do more than tinker with Windows 8, I recommend that you have at least 60 GB of free disk space, plus enough extra disk space to accommodate a paging file equal in size to the amount of RAM in your PC.

And one extra caution: If you've protected your system drive with BitLocker encryption, stop right now. This will just make you cry.

OK? We good? Then continue...

Download the Windows 8 Release Preview ISO file and use the download tool to make a bootable USB flash drive or DVD:

You are now ready to begin the process of creating a virtual hard disk and installing Windows 8.

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