I have seen a bunch of posts about folks having issues with upgrading their VM from XP (whatever version) to Win 7. I just wanted to post that I had NO issues whatsoever upgrading my XP Professional (No service pack) VM to Win 7 Home Premium using the upgrade version. I have a 21.5" iMac with Snow Leopard (10.6.2). I first upgraded to Parallels build 5.0.9344. I then purchased Windows 7 Home Premium from the store at Microsoft.com and downloaded it as an .ISO image (32 Bit version). I then set the XP VM to boot from CD, and mounted the .iso image I had downloaded as the "CD". I let the installation go through its paces, then after Win 7 was totally installed, I changed the VM preferences in Parallels to Windows 7 and changed the boot order to HDD first. When I rebooted, Windows 7 gave me a message about hardware being changed, and it went through a short "repair" cycle. It then rebooted again, and Win 7 came up. I reinstalled Parallels Tools and was up and running with no problems!! All in about an hour. I hope this will help anyone "on the fence", as I was a bit nervous about purchasing Parallels and Win 7, but in the end was pleasantly surprised at the ease of installation. I am now running Win 7, Ubuntu, and Chrome OS all through Parallels. Fantastic product!!!