Microsoft Hyper-V... how it works.
Partitions.
Hyper-V supports isolation in terms of partitions. (A partition is a logical unit of isolation, supported by the hypervisor, in which operating systems execute) A hypervisor instance has to have at least one parent partition, running Windows Server 2008. The virtualization stack runs in the parent partition and has direct access to the hardware devices. The parent partition then creates the child partitions which host the guest OSs. A virtualized partition does not have access to the physical processor, nor does it handle its real interrupts. Instead, it has a virtual view of the processor and runs in Guest Virtual Address. Child partitions do not have direct access to hardware resources, but instead have a virtual view of the resources, in terms of virtual devices.
Virtual Devices.
Any request to the virtual devices is redirected via the VMBus to the devices in the parent partition, which will manage the requests. The VMBus is a logical channel which enables inter-partition communication. The response is also redirected via the VMBus. If the devices in the parent partition are also virtual devices, it will be redirected further until it reaches the parent partition, where it will gain access to the physical devices. Parent partitions run a Virtualization Service Provider (VSP), which connects to the VMBus and handles device access requests from child partitions. Child partition virtual devices internally run a Virtualization Service Client (VSC), which redirect the request to VSPs in the parent partition via the VMBus. This entire process is transparent to the guest OS.
I/O
Virtual Devices can also take advantage of a Windows Server Virtualization feature, named Enlightened I/O, for storage, networking and graphics subsystems, among others. Enlightened I/O is specialized virtualization-aware implementation of high level communication protocols like SCSI to take advantage of VMBus directly, that allows bypassing any device emulation layer. This makes the communication more efficient, but requires the guest OS to support Enlightened I/O. Windows 2008 and Windows Vista and SUSE Linux are currently the only operating systems that support Enlightened I/O, allowing them therefore to run faster as guest operating systems under Hyper-V than other operating systems that need to use slower emulated hardware.