OpenStack Compute requires a hypervisor and Compute controls the hypervisors through an API server. The process for selecting a hypervisor usually means prioritizing and making decisions based on budget and resource constraints as well as the inevitable list of supported features and required technical specifications. The majority of development is done with the KVM and Xen-based hypervisors. Refer to http://wiki.openstack.org/HypervisorSupportMatrix for a detailed list of features and support across the hypervisors.
With OpenStack Compute, you can orchestrate clouds using multiple hypervisors in different zones. The types of virtualization standards that may be used with Compute include:
KVM - Kernel-based Virtual Machine
LXC - Linux Containers (through libvirt)
QEMU - Quick EMUlator
UML - User Mode Linux
VMWare vSphere 4.1 update 1 and newer
Xen - Xen, Citrix XenServer and Xen Cloud Platform (XCP)
Bare Metal - Provisions physical hardware via pluggable sub-drivers.