I think I have tried this before and failed. I can't find anything on line which confirms or denies this.
Maybe I just did it wrong. Anyone out there try this with success? Or can anyone confirm this does not work?
Windows XP (Home and Professional editions) will install and run under VirtualBox.org (versions 3 and 4, but you should try to use version 4 because it's faster) on Windows 7 (64-bit edition) without any problems. I have a few clients doing this so that they can continue to support some old 16-bit applications that simply won't run in any edition of Windows 7 due to compatibility problems.
You can either use a real installation CD-ROM to install Windows XP (you'll need to configure the CD-ROM drive to pass-through to your VirtualBox session in the "Drives" configuration settings), or create a .ISO file of the installation CD (which is a good idea for backups anyway, and will result in a faster installation too) and mount that .ISO as a CD-ROM drive in VirtualBox ("Drives" configuration settings again).