In virtualization technology domain, researches mainly focus on strengthening the isolation barrier between virtual machines (VMs) that are co-resident within a single physical machine. At the same time, there are many kinds of communication intensive distributed applications such as web services, transaction processing, graphics rendering and high performance grid applications, which need to communicate with each other on the co-resident VMs. Current inter-VM communication mechanisms can’t adequately satisfy the requirement of such applications. In this paper, we present the design and implementation of a high performance inter-VM communication mechanism called IVCOM in Xen virtual machine environment. We propose IVCOM in para-virtualization and also extend for full-virtualization. As a result of our survey, in Para-virtualization, there are mainly three kinds of overheads that contribute to the poor performance: the TCP/IP processing cost in each domain, page flipping overhead and long communication path between both sides of the socket. IVCOM achieves high performance by bypassing protocol stacks, shunning page flipping and providing a direct and high performance communication path between VMs residing with the same physical machine. And in Full-virtualization, frequent mode tuning between root mode and non-root mode import too much overhead. IVCOM applies a direct communication channel between domain 0 and hardware virtual VM (HVM) and can greatly reduce the VM entry/exit operations which can improve the HVM performance. In our evaluation, we observe that IVOCM can reduce the inter-VM round trip latency by up to 3 times and increase throughput by up to 3 times which prove the efficiency of IVCOM in para-virtualized environment. In full-virtualized environment, IVCOM can greatly reduce mode tuning times in the communication between domain 0 and HVM.