How to Enable Nested ESXi & Other Hypervisors in vCloud Director 5.1

The process to enable  "Nested Virtualization" in the latest release of vCloud Director 5.1 and create your own virtual lab similar to VMware's vSEL (Virtual Sales Enablement Cloud) is very similar to the previous steps outlined for vCloud Director 1.5 release. The only change is how VHV (Virtual Hardware-Assisted Virtualization) aka "Nested Virtualization" is enabled in vCloud Director 5.1 and ESXi 5.1.

In the vCloud Director 1.5, to enable VHV, you needed to add a special SQL statement that would enable VHV for the underlying ESXi 5.0 hosts. With the latest release of vCloud Director 5.1, that is no longer necessary and you now enable it on a Per VM basis within the vCloud Director 5.1 UI.

Here are the steps for enabling VHV for vCloud Director 5.1

• Insert SQL statements into VCD Database that perform the following:
• Enable new "VMware" guestOS Family
• Enable new guestOS Type ESXi 4.x and 5.x 
• Enable host preparation to enable VHV (vSphere 5.0 & vCloud 1.5 only)
• Enable promiscuous mode
• Insert SQL statement into VCD Database for Network Pool that is being used for your ESXi VMs
• Enable both Promiscuous Mode and Forged Transmit for vSphere Backed Portgroup within vCenter Server or ESXi host

The SQL statements can be found in this article and have not changed for vCloud Director 5.1

Here is a screenshot of what you should see in the vCloud Director 5.1 UI for creating a new VM and you should now have the ability to select a new guestOS Type called "VMware" and select either an ESXi 4.x or ESXi 5.x guestOS Version.

To enable VHV for the VM, you will need to also check the box "Exposed hardware-assisted CPU virtualization to guestOS" and this will allow you to run a nested ESXi VM as well as 64-bit nested VMs, assuming your physical CPUs support it. To learn more about running VHV on ESXi 5.1, take a look at this article here for more details.