Having a dedicated partition will ultimately perform better and the installation process is a lot easier than setting this up to run in VMware. If you’re serious about Lion development, remember that virtual machines have their limitations, and you should probably just setup a dedicated partition to run the developer preview directly. This is really only recommended for more technically inclined Mac OS X users. If you want to run Mac OS X 10.7 Lion Developer Preview but you don’t want to bother setting up another partition or upgrading your existing Mac OS X 10.6 installation, you can go with a third option: running Lion in a virtual machine with VMWare. The older method is repeated below for posterity sake:

Installation of Lion is extremely fast, and you are then able to boot and use your virtual OS X 10.7 install.

Choose Continue and select your settings, and boot the VM.

Locate the “Install Mac OS X Lion.app” (here’s how to redownload Lion from the App Store) in your /Applications/ folder and drag that into the “New Virtual Machine Assistant” window.

Apple os x server vmware