A system, method and computer program product for increasing efficiency of Guest OS code in a Virtual Machine, including installing a driver (Guest Tool) in the Virtual Machine; upon detection of an event in the Virtual Machine that could require a context switch to a Virtual Machine Monitor (VMM), intercepting the event; analyzing the event for whether the event can be handled in the VM and without a context switch; for those events that can be handled natively in the VM, replacing selected instructions with other instructions that accomplish the same task but do not require a context switch; for those events that cannot be handled natively in the VM, transferring control to the VMM; handling the event in the VMM; and returning control to the VM.