Windows 7 has some good and in-built features when it comes to program compatibility, which will help you to run several windows xp programs directly in windows 7, but what if you have an important software which is real old and is not compatible with windows 7… Then its time to try xp mode, lets see how to activate xp mode in step by step method.
XP mode, it is a virtual copy of windows xp that run's in a window in your windows 7 pc

• Firstly make sure that your processor is capable of hardware virtualization and its virtualization is turned on in bios setting(we will know how to find it later in this post)
• To activate xp mode you require a good memory(RAM) i.e at least 2GB
• To install windows virtual pc you require a  20MB disk space and another 15GB hard-disk space for per virtual Windows environment

Step #1: Make sure that your processor is capable of hardware virtualization and is turned on in your bios settings(usally found at advanced settings). To check your processor capability you may download Intel's official Intel Processor Identification Utility if your are using Intel processor,  otherwise you can download and use a simple app called SecureAble which will help you.
If you get the result as yes then you may proceed to next step, otherwise you should look for other way(we will discuss about it later in other post).
Step #2: In this step you have to download and install two more applications called Windows Virtual PC Beta, virtualization software for "XP Mode" and Windows XP Mode Beta, which is a specially crafted XP virtual machine. These two apps are directly supplied by Microsoft.
Step #3: Now reboot your pc and start virtual windows xp from your start menu and complete the wizard. Once you have completed the wizard you see a dialog that sets xp.
If every thing done well, you will see Virtual Windows XP window, which prompts to install a anti-virus. I recommend you to download and install a good antivirus software if you use internet or if you try to do any thing crazy.