The VHDX file extension represents a Virtual Hard Disk v2 file format. This format is used by Microsoft's Hyper-V virtualization platform to store the contents of a virtual machine's hard drive. Think of it as a container file that holds everything that would normally reside on a physical hard drive, including the operating system, applications, user data, and system files. VHDX files offer several advantages over the older VHD format, including larger storage capacity (up to 64 TB), improved data corruption resilience, and better performance. They support features like dynamic resizing, allowing the virtual disk to grow as needed, and differencing disks, which enable creating snapshots and managing multiple virtual machines efficiently. VHDX files are crucial for creating and managing virtualized environments, allowing users to run multiple operating systems on a single physical machine. They are also used for backups, disaster recovery, and software testing.