This guide explains how you can set up LVM-based virtual machines on a Xen host running on Debian Etch instead of virtual machines that use disk images. Virtual machines that use disk images are very slow and heavy on disk IO.
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In this example I'm using a Debian Etch host with the LVM volume group /dev/vg0 that has about 50GB of space. /dev/vg0 contains two logical volumes, /dev/vg0/root and /dev/vg0/swap_1 that consume about 7GB of space – the rest is not allocated and can be used to create logical volumes for our virtual machines: