Red Hat recently launched the public beta of its Enterprise Linux (RHEL) 5.5 which introduces the memory ballooning overcommitment technique for KVM.
The beta build finally includes the virtio balloon driver that was missing in RHEL 5.4. This means that KVM virtual machines will be able to change allocated memory at run-time.
KVM got memory ballooning in September 2008 but only now it appears in an enterprise Linux distribution.
Some may argue that this technique alone is not enough to achieve efficient memory overcommitment (VMware for example also uses contend-based page sharing and demand paging) but Red Hat also has content-based page sharing since RHEL 5.4 thanks to the KVM integration with Kernel SamePage (KSP).