The Reduced Functionality Mode was introduced into Windows Vista via the Software Protection Platform. The Reduced Functionality Mode is also the biggest scarecrow of the Windows Product Activation aimed at stopping Windows piracy.

Windows Vista delivers a 30-day grace period. If this period passes without activation, the operating system will move into Reduced Functionality Mode. As a consequence of RFM, The Aero GIU and ReadyBoost will be disabled, the functionality of Windows Defender will be amputated, optional downloads and updates, except critical security updates, via Windows Update and Microsoft download center will be disallowed, the start menu and desktop icons as well as the background will disappear, installed applications and the opening of documents will be disabled although access to documents will still be available.

In the Reduced Functionality Mode scenario, the user will only be able to operate the web browser for a one hour session in order to facilitate a valid activation. "After one hour, the system automatically logs out the currently logged-on user, without any warning," informed Microsoft.

Additionally, Microsoft revealed that:
- MAK-activated computers go into RFM if they fail to activate within 30 days of installation or if they fail to renew activation within 30 days of a major hardware replacement.
- KMS-activated computers enter RFM:
- if they fail to activate within 30 days of installation,
- if they fail to renew activation within 210 (180 days plus 30 days grace period) days of previous renewal and,
- if they fail to renew activation within 30 days of hard drive replacement.

Throughout the length of the 30-day grace period, Vista will continuously notify the user that the operating system is not activated. The frequency of the reminders will increase at a pace that will ensure that - by the end of the grade period - the notifications will be once every hour.