You can do a Search, this issue has come up many times.
Short answer:
If you want to run
most applications -- except those requiring 3D graphics and those requiring maximum processor power -- you can run an emulator.
Parallels is by far the most popular. I use it for running MSIE when I need ActiveX access, and other little necessities that aren't easily (or cheaply) available for Mac yet.
If you do need the full benefit of your process and RAM and video card, then booting directly into WinXP is a much better solution. You do that with BootCamp.