Abstract-Server virtualization offers the ability to slice large, underutilized physical servers into smaller, parallel virtual machines (VMs), enabling diverse applications to run in isolated environments on a shared hardware platform. Effective management of virtualized cloud environments introduces new and unique challenges, such as efficient CPU scheduling for virtual machines, effective allocation of virtual machines to handle both CPU intensive and I/O intensive workloads. Although a fair number of research projects have dedicated to measuring, scheduling, and resource management of virtual machines, there still lacks of in-depth understanding of the performance factors that can impact the efficiency and effectiveness of resource multiplexing and resource scheduling among virtual machines. In this paper, we present our experimental study on the performance interference in parallel processing of CPU and network intensive workloads in the Xen Virtual Machine Monitors (VMMs). We conduct extensive experiments to measure the performance interference among VMs running network I/O workloads that are either CPU bound or network bound. Based on our experiments and observations, we conclude with four key findings that are critical to effective management of virtualized cloud environments for both cloud service providers and cloud consumers. First, running networkintensive workloads in isolated environments on a shared hardware platform can lead to high overheads due to extensive context switches and events in driver domain and VMM. Second, co-locating CPUintensive workloads in isolated environments on a shared hardware platform can incur high CPU contention due to the demand for fast memory pages exchanges in I/O channel. Third, running CPUintensive workloads and network-intensive workloads in conjunction incurs the least resource contention, delivering higher aggregate performance. Last but not the least, identifying factors that impact the total demand of the exchanged memory pages is critical to the indepth understanding of the interference overheads in I/O channel in the driver domain and VMM.