Does Parallel.ForEach limit the number of active threads?

No, it won't start 1000 threads - yes, it will limit how many threads are used. Parallel Extensions uses an appropriate number of cores, based on how many you physically have and how many are already busy. It allocates work for each core and then uses a technique called work stealing to let each thread process its own queue efficiently and only need to do any expensive cross-thread access when it really needs to.

Have a look at the PFX Team Blog for loads of information about how it allocates work and all kinds of other topics.

Note that in some cases you can specify the degree of parallelism you want, too.

On a single core machine... Parallel.ForEach partitions (chunks) of the collection it's working on between a number of threads, but that number is calculated based on an algorithm that takes into account and appears to continually monitor the work done by the threads it's allocating to the ForEach. So if the body part of the ForEach calls out to long running IO-bound/blocking functions which would leave the thread waiting around, the algorithm will spawn up more threads and repartition the collection between them. If the threads complete quickly and don't block on IO threads for example, such as simply calculating some numbers, the algorithm will ramp up (or indeed down) the number of threads to a point where the algorithm considers optimum for throughput (average completion time of each iteration).

Basically the thread pool behind all the various Parallel library functions, will work out an optimum number of threads to use. The number of physical processor cores forms only part of the equation. There is NOT a simple one to one relationship between the number of cores and the number of threads spawned.

I don't find the documentation around the cancellation and handling of synchronizing threads very helpful. Hopefully MS can supply better examples in MSDN.

Don't forget, the body code must be written to run on multiple threads, along with all the usual thread safety considerations, the framework does not abstract that factor... yet.

It works out an optimal number of threads based on the number of processors/cores. They will not all spawn at once.