Some Parallels Desktop users who updated to the recently released Desktop 5.0 software have run into a problem where upon trying to boot in Windows the system displays the infamous "blue screen of death." This has been reported to happen when starting installations of Windows XP, but may also happen with other versions of Windows.
This problem has to do with how the program handles multiple CPUs, and according to the Parallels website the quick workaround is to install the Parallels Tools with only one processor enabled for the virtual machine. The following procedure will do this (from this Parallels knowledgebase document):
- Shut down your virtual machine if it is started now.
- Set virtual machine CPU number to 1 in VM configuration. To do this, open Virtual Machine menu->Configure... and set "1" in "Processors" drop-down.
- Start the virtual machine. This time it will boot normally.
- Login and wait until Parallels Tools are installed.
After the tools are installed, you can shut down the virtual machine and change the CPU settings to the desired number, and the system should boot normally and be functional again.