VMware/VirtualBox and partitioning

I am completely new to the concept of virtual machines and am trying to set up my first VirtualBox VM. Specifically I am trying to run Ubuntu as the guest on my Windows 7 host machine.

I'm at a stage where it's telling me that I have to partition my virtual disk in order to correctly install Ubuntu. I know this may be a stupid question, but I have so much treasured data on my hard drive, I'd hate to somehow lose it while partitioning my VM's disk!

If I move forward with this partitioning, does it just partition the free space I allocated to it when I configured the VM in the VirtualBox wizard, or do I run any risk (at all) of overwriting something on my Windows machine?

The virtual disk will not overwrite your hard drive's data. The partitioning just occurs within the virtual disk you created, not your real hard drive.

It's called "virtual" because it's simply a VDI file that is either fixed size (file size is what you set it to be) or dynamically expanding (starts small, file size increases as you write more data).