A: Virtualization provides an excellent framework for testing configuration changes, evaluating software, and familiarizing yourself with new technologies. Sometimes what needs to be evaluated is hypervisor software itself. Today's hypervisors, most notably ESXi in VMware vSphere 5.0, include enhanced support for running VMs inside other VMs. This process has become known as nested virtualization.
Nested virtualization has many uses when virtualization platforms themselves require evaluation and testing. One use might be creating an ESXi VM atop an instance of VMware Workstation. After you create this "outer" ESXi VM, you can install and administer an "inner" Windows VM.
Another option is creating an "outer" ESXi VM atop an ESXi host, with an "inner" Hyper-V host running atop the virtualized ESXi VM. Nested virtualization, as you can see, tends to get complex in its naming.