How to create VM image containing Windows 2008 R2

I want to know how can I create a virtual machine which should contain windows 2008 r2 server on my laptop which has windows 7 running.

Basically, I want to install one application which requires windows 2008 R2 but I am not understanding how can I do it?

I don't want to disturb my current windows 7 settings so I thought I will create a virtual machine which contains windows 2008 r2 and once that is installed, I can install that application but I am not understanding how to proceed ahead with that?

Any help will be appreciated.