Heterogeneous embedded systems, where configurable or application specific hardware devices (FPGAs and ASICs) are used alongside traditional processors, are becoming more and more widely used. To facilitate rapid design and development of such heterogeneous hardware/software systems, it is essential to expand the software design cycle to integrate hardware modeling and simulation. Co-simulation and exploration of the joint design space are key problems. To design, develop and verify such systems, different kinds of simulations at various levels of granularity are required. The hardware modeling and simulation framework of the Model-Based Integrated Simulation Framework (MILAN) integrates these requirements into a single powerful design, development and simulation environment.