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Despite the potential given by the combination of multi-tenancy and virtualization, resource utilization in today's data centers is still low. We identify three key characteristics of cloud services and infrastructure as-a-service management practices: burstiness in service workloads, fluctuations in virtual machine resource usage over time, and virtual machines being limited to pre-defined sizes only. Based on these characteristics, we propose scheduling and admission control algorithms that incorporate resource overbooking to improve utilization. A combination of modeling, monitoring, and prediction techniques is used to avoid overpassing the total infrastructure capacity. A performance evaluation using a mixture of workload traces demonstrates the potential for significant improvements in resource utilization while still avoiding overpassing the total capacity.