Create a new SharePoint Virtual PC

Steps:
Creating a new Virtual Machine ( VHD ) from scratch
http://www.pptspaces.com/sharepointreporterblog/Lists/Posts/Post.aspx?ID=28

Hardware :
Laptop/ Desktop ( OS Home Edition is not supported - but will still work , ignore the warnings you get during any installation ) - 2 GB RAM minimum & 20GB free hard disk space

Download Links :

Virtual PC 2007
Virtual PC 2007


Download Windows 2k3 preconfigured VHD


Microsoft .NET Framework Version 2.0 Redistributable Package (x86 or x64)


Microsoft .NET Framework 2.0 Service Pack 1 (x86 or x64)


Microsoft .NET Framework 3.0 Redistributable Package ( File Size should be 54 MB approx ) (Don't download the setup , download from x86 or x64 link depending upon your machine configuration)

SQL Server 2005 Express
or
SQL Server 2005 Standard Trail


Microsoft Office SharePoint Server 2007 Trial Version
( Make sure you register to get the keys for the product above, keys will not be made available on the page if you don't register )

Pre-Configured VHD Downloads ( Does not have Visual Studio installed )

Windows SharePoint Services 3.0 SP1 Developer Evaluation VPC Image ( Comes with Visual Studio 2008 )