We have a small network that currently has a Windows 2003 SP2 server running as the PDC, another windows 2003 SP2 server running exchange 2003 that is also a DC, and a windows 2008 R2 server. We have purchased another windows 2008 R2 server and plan on installing Exchange 2010 on it. Obviously to do that we need to upgrade the domain to windows 2008. The question I have is this- can we raise the Domain Functional level to Win2k8 with the old exchange server still a DC? I have read that you should not demote a DC that is running exchange because it can break some functionality of exchange. But can you raise the functionality of the domain to 2008 when a 2003 DC is still in the mix? If not, any suggestions on how to tackle this?