You need to use the partition editor, Gparted or similar, and first reduce
the size of home. Then from the freed up space you create a root partition
for 11.04. This should not take more than 20 GBs. You can use the same home
partition. You can either use a new user name and keep things separate or
re-use the one you have. I prefer a separate one just to be safe.

Then you install 11.04 to the partition that you created. Choose a manual,
custom or expert installation whatever they call it now (it keeps changing).
It will detect your existing installation of Ubuntu 10.10 and offer to
upgrade. Decline that option. You set the mount point for 11.04's root
partition as / on the created partition and use the existing home partition
as /home. Format ONLY the root partition. Check and double check before
committing to the changes. Use ext4 for both or whatever else you might be
using instead.

After installation you may want to set the default grub choice as 10.10
instead of 11.04 or even Windows. You do this with a text editor or use an
utility to do it.

I have booted at least 8 different OSes in the past. Things that can mess
you up are: some distros will not detect other distributions (Fedora and
Mandriva are bad for this, but Ubuntu is great). Windows of all stripes will
destroy grub if it is given the chance. An incomplete installation which
mangles grub is also a potential problem. Your installations will still be
there but you cna't enter them without fixing grub from the Live CD. You
make a mistake and install to the wrong partition (so pay close attention).
Or, you have some funky BIOS settings that mess up grub. You can fix this
temporarily be editing grub on the fly and then making it permanent once in.

It is not hard once you have done it a few times. You just have to keep your
wits about you and know which partitions are which and make sure that you
only format things you want to.

I suggest a VM instead. I use Oracle's Virtual Box for Windows on my primary
computer. It is available in Ubuntu Software Center. You can install several
OSes, including other versions of Linux under it without repartioning.

I agree a vm is a good idea for some senarios, but the one in software center
does not allow usb conectivity. It is better (imo) to get the puel version on
the virtualbox website if full functionality is desired. Another thing to think
about is what sort of OS you want to test. Testing unity or gnome 3 in a VM is
not practical since 3D composting is required and support for that in a VM is
poor at best.

I agree that running 11.04 in a VM is a bad. Unity requires compositing and
that does not work in a VM. You can test 11.04 with classic GNOME or Unity
2D, but it does not give an accurate picture of where Canonical is headed.
It would work with most other distros and any other version of Ubuntu, but I
have been trying since January to get a good experience of 11.04 in a VM. I
can run it, but not with Unity (only 2D Unity which is available by PPA
only). GNOME 3 just plain does not work with my ATI card even in a full
installation. It flickers so bad that it is unusable.

What I'm wanting to test out is Ubuntu ZZ.YY without messing up another
version. I don't trust Oracle much farther then I do Microsoft. That is why
I have dropped OpenOffice and use LibreOffice now.

Living with Microsoft, Oracle and other big companies is like living with a
big gorilla. When it decides to take over and kick your butt...

Rather than run from a VM perhaps people could opt for a usb installation.
An 8 GB usb stick should work fine as long as the user does not install lots
of applications. Just make sure that the grub boot loader is installed to
the usb key and not on hard drive. I do it all of the time. It is better
than a VM in terms of performance, but it has its limitations, too.