diff --git a/hypervisor/arch/x86/cpu.c b/hypervisor/arch/x86/cpu.c
index b0e4049f8..1bfed18db 100644
--- a/hypervisor/arch/x86/cpu.c
+++ b/hypervisor/arch/x86/cpu.c
@@ -80,6 +80,7 @@ static struct cpu_capability cpu_caps;
 struct cpuinfo_x86 boot_cpu_data;
 
 static void vapic_cap_detect(void);
+static void cpu_xsave_init(void);
 static void cpu_set_logical_id(uint32_t logical_id);
 static void print_hv_banner(void);
 int cpu_find_logical_id(uint32_t lapic_id);
@@ -364,6 +365,8 @@ void bsp_boot_init(void)
 
 	vapic_cap_detect();
 
+	cpu_xsave_init();
+
 	/* Set state for this CPU to initializing */
 	cpu_set_current_state(CPU_BOOT_ID, CPU_STATE_INITIALIZING);
 
@@ -490,6 +493,8 @@ void cpu_secondary_init(void)
 
 	pr_dbg("Core %d is up", get_cpu_id());
 
+	cpu_xsave_init();
+
 	/* Release secondary boot spin-lock to allow one of the next CPU(s) to
 	 * perform this common initialization
 	 */
@@ -699,3 +704,26 @@ bool is_vapic_virt_reg_supported(void)
 {
 	return ((cpu_caps.vapic_features & VAPIC_FEATURE_VIRT_REG) != 0);
 }
+
+bool is_xsave_supported(void)
+{
+	/*
+	 *todo:
+	 *below flag also should be tested, but current it will be false
+	 *as it is not updated after turning on the host's CR4.OSXSAVE bit,
+	 *will be fixed in cpuid related patch.
+	 *boot_cpu_data.cpuid_leaves[FEAT_1_ECX] & CPUID_ECX_OSXSAVE
+	 **/
+	return !!(boot_cpu_data.cpuid_leaves[FEAT_1_ECX] & CPUID_ECX_XSAVE);
+}
+
+static void cpu_xsave_init(void)
+{
+	uint64_t val64;
+
+	if (is_xsave_supported()) {
+		CPU_CR_READ(cr4, &val64);
+		val64 |= CR4_OSXSAVE;
+		CPU_CR_WRITE(cr4, val64);
+	}
+}
diff --git a/hypervisor/arch/x86/cpuid.c b/hypervisor/arch/x86/cpuid.c
index 7271d46cd..e9563296e 100644
--- a/hypervisor/arch/x86/cpuid.c
+++ b/hypervisor/arch/x86/cpuid.c
@@ -285,7 +285,7 @@ void guest_cpuid(struct vcpu *vcpu,
 	uint32_t subleaf = *ecx;
 
 	/* vm related */
-	if (leaf != 0x1 && leaf != 0xb) {
+	if (leaf != 0x1 && leaf != 0xb && leaf != 0xd) {
 		struct vcpuid_entry *entry =
 			find_vcpuid_entry(vcpu, leaf, subleaf);
 
@@ -329,6 +329,18 @@ void guest_cpuid(struct vcpu *vcpu,
 		/*mask vmx to guest os */
 		*ecx &= ~CPUID_ECX_VMX;
 
+		/*no xsave support for guest if it is not enabled on host*/
+		if (!(*ecx & CPUID_ECX_OSXSAVE))
+			*ecx &= ~CPUID_ECX_XSAVE;
+
+		*ecx &= ~CPUID_ECX_OSXSAVE;
+		if (*ecx & CPUID_ECX_XSAVE) {
+			uint64_t cr4;
+			/*read guest CR4*/
+			cr4 = exec_vmread(VMX_GUEST_CR4);
+			if (cr4 & CR4_OSXSAVE)
+				*ecx |= CPUID_ECX_OSXSAVE;
+		}
 		break;
 	}
 
@@ -343,6 +355,16 @@ void guest_cpuid(struct vcpu *vcpu,
 			cpuid_subleaf(leaf, subleaf, eax, ebx, ecx, edx);
 		break;
 
+	case 0x0d:
+		if (!is_xsave_supported()) {
+			*eax = 0;
+			*ebx = 0;
+			*ecx = 0;
+			*edx = 0;
+		} else
+			cpuid_subleaf(leaf, subleaf, eax, ebx, ecx, edx);
+		break;
+
 	default:
 		break;
 	}
diff --git a/hypervisor/arch/x86/vmexit.c b/hypervisor/arch/x86/vmexit.c
index a90326ca3..006497bcd 100644
--- a/hypervisor/arch/x86/vmexit.c
+++ b/hypervisor/arch/x86/vmexit.c
@@ -37,6 +37,7 @@
 static int rdtscp_handler(struct vcpu *vcpu);
 static int unhandled_vmexit_handler(struct vcpu *vcpu);
 static int rdtsc_handler(struct vcpu *vcpu);
+static int xsetbv_vmexit_handler(struct vcpu *vcpu);
 /* VM Dispatch table for Exit condition handling */
 static const struct vm_exit_dispatch dispatch_table[] = {
 	[VMX_EXIT_REASON_EXCEPTION_OR_NMI] = {
@@ -151,7 +152,7 @@ static const struct vm_exit_dispatch dispatch_table[] = {
 	[VMX_EXIT_REASON_WBINVD] = {
 		.handler = unhandled_vmexit_handler},
 	[VMX_EXIT_REASON_XSETBV] = {
-		.handler = unhandled_vmexit_handler},
+		.handler = xsetbv_vmexit_handler},
 	[VMX_EXIT_REASON_APIC_WRITE] = {
 		.handler = apic_write_vmexit_handler,
 		.need_exit_qualification = 1}
@@ -418,26 +419,57 @@ int invlpg_handler(__unused struct vcpu *vcpu)
 
 	return 0;
 }
+#endif
 
 /*
- * XSETBV instruction set's the XCR0 that is used to tell for which components
- * states can be saved on a context switch using xsave.
- *
- * We don't handle this right now because we are on a platform that does not
- * support XSAVE/XRSTORE feature as reflected by the instruction CPUID.
- *
- * to make sure this never get called until we support it we can prevent the
- * reading of this bit in CPUID VMEXIT.
- *
- * Linux checks this in CPUID: cpufeature.h: #define cpu_has_xsave
+ * XSETBV instruction set's the XCR0 that is used to tell for which
+ * components states can be saved on a context switch using xsave.
  */
-static int xsetbv_instr_handler(__unused struct vcpu *vcpu)
+static int xsetbv_vmexit_handler(struct vcpu *vcpu)
 {
-	ASSERT("Not Supported" == 0, "XSETBV executed");
+	int idx;
+	uint64_t val64;
+	struct run_context *ctx_ptr;
 
+	val64 = exec_vmread(VMX_GUEST_CR4);
+	if (!(val64 & CR4_OSXSAVE)) {
+		vcpu_inject_gp(vcpu);
+		return -1;
+	}
+
+	idx = vcpu->arch_vcpu.cur_context;
+	if (idx >= NR_WORLD)
+		return -1;
+
+	ctx_ptr = &(vcpu->arch_vcpu.contexts[idx]);
+
+	/*to access XCR0,'rcx' should be 0*/
+	if (ctx_ptr->guest_cpu_regs.regs.rcx != 0) {
+		vcpu_inject_gp(vcpu);
+		return -1;
+	}
+
+	val64 = ((ctx_ptr->guest_cpu_regs.regs.rax) & 0xffffffff) |
+			(ctx_ptr->guest_cpu_regs.regs.rdx << 32);
+
+	/*bit 0(x87 state) of XCR0 can't be cleared*/
+	if (!(val64 & 0x01)) {
+		vcpu_inject_gp(vcpu);
+		return -1;
+	}
+
+	/*XCR0[2:1] (SSE state & AVX state) can't not be
+	 *set to 10b as it is necessary to set both bits
+	 *to use AVX instructions.
+	 **/
+	if (((val64 >> 1) & 0x3) == 0x2) {
+		vcpu_inject_gp(vcpu);
+		return -1;
+	}
+
+	write_xcr(0, val64);
 	return 0;
 }
-#endif
 
 static int rdtsc_handler(struct vcpu *vcpu)
 {
diff --git a/hypervisor/arch/x86/vmx.c b/hypervisor/arch/x86/vmx.c
index fe53f16a5..702bd6425 100644
--- a/hypervisor/arch/x86/vmx.c
+++ b/hypervisor/arch/x86/vmx.c
@@ -931,6 +931,11 @@ static void init_exec_ctrl(struct vcpu *vcpu)
 			exec_vmwrite(VMX_TPR_THRESHOLD, 0);
 	}
 
+	if (is_xsave_supported()) {
+		exec_vmwrite64(VMX_XSS_EXITING_BITMAP_FULL, 0);
+		value32 |= VMX_PROCBASED_CTLS2_XSVE_XRSTR;
+	}
+
 	exec_vmwrite(VMX_PROC_VM_EXEC_CONTROLS2, value32);
 	pr_dbg("VMX_PROC_VM_EXEC_CONTROLS2: 0x%x ", value32);
 
diff --git a/hypervisor/include/arch/x86/cpu.h b/hypervisor/include/arch/x86/cpu.h
index 0c5ae4219..60adb7eda 100644
--- a/hypervisor/include/arch/x86/cpu.h
+++ b/hypervisor/include/arch/x86/cpu.h
@@ -247,6 +247,7 @@ bool is_vapic_supported(void);
 bool is_vapic_intr_delivery_supported(void);
 bool is_vapic_virt_reg_supported(void);
 bool get_vmx_cap(void);
+bool is_xsave_supported(void);
 
 /* Read control register */
 #define CPU_CR_READ(cr, result_ptr)                         \
@@ -427,6 +428,15 @@ msr_write(uint32_t reg_num, uint64_t value64)
 	CPU_MSR_WRITE(reg_num, value64);
 }
 
+static inline void
+write_xcr(int reg, uint64_t val)
+{
+	uint32_t low, high;
+
+	low = val;
+	high = val >> 32;
+	asm volatile("xsetbv" : : "c" (reg), "a" (low), "d" (high));
+}
 #else /* ASSEMBLER defined */
 
 #endif /* ASSEMBLER defined */
diff --git a/hypervisor/include/arch/x86/vmx.h b/hypervisor/include/arch/x86/vmx.h
index 317f1e1a6..da34ee543 100644
--- a/hypervisor/include/arch/x86/vmx.h
+++ b/hypervisor/include/arch/x86/vmx.h
@@ -83,6 +83,8 @@
 #define	VMX_EOI_EXIT3_FULL			0x00002022
 #define	VMX_EOI_EXIT3_HIGH			0x00002023
 #define	VMX_EOI_EXIT(vector)	(VMX_EOI_EXIT0_FULL + ((vector) / 64) * 2)
+#define VMX_XSS_EXITING_BITMAP_FULL		0x0000202C
+#define VMX_XSS_EXITING_BITMAP_HIGH		0x0000202D
 /* 64-bit read-only data fields */
 #define VMX_GUEST_PHYSICAL_ADDR_FULL 0x00002400
 #define VMX_GUEST_PHYSICAL_ADDR_HIGH 0x00002401