Limitations of Grid, such as provisioning the dynamic execution environment are handled by virtualization technology. While delivering virtual resources for executing the applications, the user's Quality of Service requirements must be ensured. This QoS management is instrumented with the help of Service Level Agreements that clearly specify the guaranteed QoS, restrictions on resource usage and the penalties associated with the deviant service behavior. To support those demanding QoS, the grid meta-schedulers must be empowered with the capability to discover the required quality, quantity and usage policy satisfied resources as per the requirements of an application. In this paper, we propose a Service Level Agreement based on-demand resource virtualization framework that provides the support for specifying the usage policies, creates and manages the virtual machines over the SLA negotiated resources that are created using either VMWare or Xen. This proposed architecture is integrated with our grid meta-scheduler, CARE Resource Broker as a value addition component. This SLA enabled broker is evaluated with the help of real-time application execution by varying the number of resources available in the test-bed and the number of policies per resource. The results conclude that the inclusion of SLA affects the resource selection behavior of the broker. In addition, the overall performance of the system is increased in terms of job throughput with an extra minimal overhead in request processing due to usage policy matching, while realizing a controlled grid resource sharing environment. These effects that are presented may be useful, while new designs are proposed to take the advantage of SLAs at the meta-scheduler level. © 2010 Elsevier Inc. All rights reserved.