RancherOS, the latest minimal Linux-based operating system for running Docker containers, was recently launched by Darren Shepherd, Rancher Lab's CTO. In contrast with Boot2Docker (another lightweight Docker-centric distribution) which openly discourages production use, RancherOS's announcement claims the new OS is production and scale-ready.
RancherOS and Boot2Docker rely on a similar bootstrap mechanism, loading a temporary root file system (ramdisk) of around 20MB along with a Linux kernel (which then takes control of execution) into memory first. This allows keeping the OS binary size to little over 20MB as well as reducing boot time to a bare minimum (under 5s), leaving it up to Docker containers to pull down the dependencies required by whatever application the user wants to run on the host.
RancherOS was designed to run Docker containers immediately on top of the kernel, namely those providing core Linux services to the users. Those services run inside (system) containers. Users can then create their own Docker (user-level) containers, as in any other Linux distro. In order to allow for isolation between system and user-level containers, two different Docker daemons are required ("system docker" is the first process started by the kernel while "user docker" runs in a special system service container created by "system docker").
Rancher claims their OS can be used in production environments as it ensures alignment with the latest Docker features and bug fixes (a process which can take a couple of months for regular Linux distros), avoids the need for init systems like systemd which can cause conflicts with Docker, and increases security given the minimal code base and system services running in the OS.
RancherOS can run in virtual machines using Vagrant or provided directly by hypervisors (QEMU, VirtualBox or VMware) and pre-built AMIs are available in multiple AWS regions.