The shortcomings of the existing solutions to the performance bottleneck and reliability problem of Internet servers are analyzed, and a solution based on IP-level load balancing is given in this paper, in which a scalable and highly available virtual Internet server can be built on a cluster of servers. Scalability is achieved by transparently adding or removing a node in the cluster. High availability can be provided by detecting the node or daemon failures and reconfiguring the system appropriately. The architecture, design and implementation of the virtual Internet server are discussed in detail. Brief performance testing results are also provided.