An apparatus and method are described for managing a virtual graphics processor unit (GPU). For example, one embodiment of an apparatus comprises: a dynamic addressing module to map portions of an address space required by the virtual machine to matching free address spaces of a host if such matching free address spaces are available, and to select non-matching address spaces for those portions of the address space required by the virtual machine which cannot be matched with free address spaces of the host; and a balloon module to perform address space ballooning (ASB) techniques for those portions of the address space required by the virtual machine which have been mapped to matching address spaces of the host; and address remapping logic to perform address remapping techniques for those portions of the address space required by the virtual machine which have not been mapped to matching address spaces of the host.