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Microsoft has announced that XP Mode, the Windows 7 add-on that will allow users to run a virtual version of Windows XP within Windows 7, has entered Release Candidate status. Windows XP Mode is specially designed for small and medium-sized businesses to help ease the migration process to Windows 7 by providing additional compatibility for their older productivity applications. The newly updated Windows XP Mode now works with the RC and RTM versions of the Windows 7 Professional, Ultimate and Enterprise SKUs.

Microsoft’s Brandon LeBlanc recommends in the blog post announcing the XP Mode RC that users install antivirus and anti-malware protections in XP Mode in addition to whatever protective steps users have taken in the native Windows 7 environment. He also cautions that XP Mode is designed for running productivity applications that won’t be upgraded to Windows 7, implying that Microsoft doesn’t expect the average consumer to get much mileage out of the feature.

The new features include:

• Attaching USB devices to Windows XP Mode applications directly from the Windows 7 task-bar can be done. This means your USB devices, such as printers and flash drives, are available to applications running in Windows XP Mode, without the need to go into full screen mode.
• Enables accessing Windows XP Mode applications with a “jump-list”. Right click on the Windows XP Mode applications from the Windows 7 task bar to select and open most recently used files.
• More flexibility of customizing where Windows XP Mode differencing disk files are stored.
• We can now disable drive sharing between Windows XP Mode and Windows 7 if you do not need that feature.
• The initial setup now includes a new user tutorial about how to use Windows XP Mode

Windows XP Mode Release Candidate Download: Windows XP Mode Release Candidate