PHP, .net and Silverlight will be integrated out of the box, along with Visual Studio 2008. The project has long been in the works, but our sources have informed us of an impending announcement that PHP 6 will ship with .net.

The glue between them is a part of the phlanger project.

From the inital post:

I am wondering why there isn't any effort in the PHP community to get PHP into the DLR. If nothing, DLR is yet another platform, and for a php programmer it gives one more playground to showcase his skillset. Anyway, my question is whether there would be any community effort to get MS adopt PHP into CLR too. I am sure there is a genuine customer requirement, and enterprises have made quite a bit of investment in PHP and they would all love to be able to take it to the .NET platform.

Responses so far include the pointing out of problems, possibilities like a Zend collaboration and lots of talk on what such a project would entail.

Known as Phalanger, the project reached Version 2.0 Beta 2 on July 30.

The primary goal of the project, released under Microsoft Shared Source Permissive License, is to enable full functionality of existing PHP scripts on .Net without any modification, Microsoft said. Unlike the original PHP interpreter, Phalanger compiles scripts into MSIL (Microsoft Intermediate Language).

The article goes on to talk about the project, the advantages it has over previous attempts, and where it's headed in the future. You can check out the CodePlex site here.