The microprocessor industry is currently struggling with higher development costs and longer design times that arise from exceedingly complex processors that are pushing the limits of instructionlevel parallelism. Meanwhile, such designs are especially ill suited for important commercial applications, such as on-line transaction processing (OLTP), which suffer from large memory stall times and exhibit little instruction-level parallelism. Given that commercial applications constitute by far the most important market for high-performance servers, the above trends emphasize the need to consider alternative processor designs that specifically target such workloads. The abundance of explicit thread-level parallelism in commercial workloads, along with advances in semiconductor integration density, identify chip multiprocessing (CMP) as potentially the most promising approach for designing processors targeted at commercial servers. This paper describes the Piranha system, a research prototype being developed at Compaq that aggressively exploits chip multiprocessing by integrating eight simple Alpha processor cores along with a two-level cache hierarchy onto a single chip. Piranha also integrates further on-chip functionality to allow for scalable multiprocessor configurations to be built in a glueless and modular fashion. The use of simple processor cores combined with an industry-standard ASIC design methodology allow us to complete our prototype within a short time-frame, with a team size and investment that are an order of magnitude smaller than that of a commercial microprocessor. Our detailed simulation results show that while each Piranha processor core is substantially slower than an aggressive next-generation processor, the integration of eight cores onto a single chip allows Piranha to outperform next-generation processors by up to 2.9 times (on a per chip basis) on important workloads such as OLTP. This performance advantage can approach a factor of five by using full-custom instead of ASIC logic. In addition to exploiting chip multiprocessing, the Piranha prototype incorporates several other unique design choices including a shared second-level cache with no inclusion, a highly optimized cache coherence protocol, and a novel I/O architecture.