History
VDMs appeared with Windows/386 2.1 and are present in all subsequent 32-bit versions of Windows. In the Windows NT family, they are, however, relegated to running DOS and Windows 3.x programs and no longer participate in the implementation of the Windows API. The Windows NT executable which is used to handle a single DOS (and Windows 3.x) environment is called ntvdm.exe. The DOS environment implemented in NTVDM is based on MS-DOS Version 5.0 even in the newest releases of Windows; many additional MS-DOS functions and commands introduced in MS-DOS Versions 6.x and in Windows 9x are missing.
VDMs were also used in OS/2 2.0 and later. OS/2 VDMs are considerably more powerful than NTVDM, e.g., block devices are supported, and various DOS versions can be booted into an OS/2 VDM. Seamless integration of Windows 3.1 and later Win32s applications in OS/2 is a concept similar to the seamless integration of XP mode based on Windows Virtual PC in Windows 7. A redirector in a "guest" VDM or NTVDM allows access on the disks of the OS/2 or NT "host". Applications in a "guest" can use named pipes for communication with their "host".
Similar to Windows 3.x 386 Enhanced Mode in architecture, EMM386 3.xx of Novell DOS 7, Caldera OpenDOS 7.01, DR-DOS 7.02 (and later) also utilizes VDMs to support pre-emptive multitasking of multiple DOS applications, when the EMM386 /MULTI option is used. This component has been under development at Digital Research / Novell since (at least) 1991 under the codename "Vladivar" (originally a separate device driver KRNL386.SYS instead of a module of EMM386). While primarily developed for the next major version of DR DOS, released as Novell DOS 7 in 1994, it was also utilized in the never released "Star Trek" project in 1992/1993.
Wine also includes a VDM, which it utilizes for running Win16 and DOS applications. Wine's VDM is compatible with both 32-bit and 64-bit operating systems. However, due to utilization of long mode, 16bit applications did not run on 64-bit Linux kernel.
Read more about this topic: Virtual DOS Machine
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—Jonathan Raban (b. 1942)