There are several flavors of that in the mainframe world.
On the big boxes you can set up LPARS (logical partitions) that each act like a separate computer with their own OSs (MVS progeny).
And in the old days, on the smaller boxes, there was (I can't remember the name of it - drat!) a sort of a stripped down master OS that would allow you to run other OSs (usually some flavor of VSE) within it. Each of the OSs would be independent of the others.