AWS has announced support for nested virtualization on EC2 instances, allowing users to run KVM or Hyper-V virtual machines inside virtualized EC2 instances. The feature is available on C8i, M8i, and R8i instance types and is enabled via an API option at launch using the `--cpu-options "NestedVirtualization=enabled"` flag. The Nitro System exposes Intel VT-x processor features to enable a three-layer architecture: the physical Nitro hypervisor (L0), the EC2 instance hypervisor (L1), and guest VMs (L2). Use cases include mobile app emulators, automotive hardware simulation, WSL on Windows, and running Firecracker microVMs without expensive bare-metal instances. Graviton instances are not supported. AWS still recommends bare-metal instances for performance-sensitive or low-latency workloads.
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