Virtualization is the creation of a virtual version of some component on top of the environment. For example, creating a virtual architecture - using QEMU to emulate ARM architecture on an x86 machine. Or using WINE to implement Windows on Linux.

QEMU
QEMUpuppy
VirtualBox
VMwarePlayer
Wine
Puppy Linux as a Virtual Machine
Virtualization Software Index

forum topic
Using Qemu to emulate RaspberryPi
Virtualization on Wikipedia