I found the same symptoms as mine in another post. I did all the suggested remedies but still get the failure. Here is the post that originally described the symptoms. It appears to me the virtual machine is trying to boot from a network, but I reviewed the BIOS settings and I can't see why it is doing this. XPM fails to start the virtual machine with a message "no boot filename received" and an error PXE-E53. I have removed and re-installed the XPM and Virtual PC software several times. I have tried the different ways to set up the virtual hard drive. I saw some references that it might be terminal server client looking to boot from the server so that feature was disable in BIOS. It gets to the point of looking at the network connection. It is set to use the same network connection at the Win 7 host. It displays the correct MAC address. After about 40 seconds it fails with the "no boot filename received message" in all cases. The other thing I've not seen before is that you cannot set the Integration features. They appear to be clicked on but grayed out. If you try to stop the failed to initialize XP machine with the CTRL-ALT-DEL it won't. If you click the X to close the window you get a three line menu. Picking Shut Down gets a message that it won't work but asks if you want turn it off (sorry I did not get the exact wording as the snip that was made on the Win 7 side has not shown up in my email). I temporarily disabled the firewall and anti-virus and got the same failures.