Update: I’ve updated the emulator image. The instructions are exactly the same, but you get newer goodies.
Disclaimer: I am not allowed to call this image “CyanogenMod” and this does not represent the project’s quality. This is only a kang.
As of this writing, CM7 has yet to hit “alpha” status. However, the following images were compiled using CM7′s Source.
Android Devs and Android Phone Modders should like this. A couple of days ago, Cyanogen added some code that allows us to build emulator images.
I decided to try it out and it works! 
So, I decided to create a User Repository you can import.

To install, simply run the Android AVD Manager you’re already familiar with, and under Available Packages, click Add Add-on Site and type:
http://nushio.fedorapeople.org/cyanogenmod/repository.xml
I’ll update the images with official releases once official releases are out (And only if the CyanogenMod Team doesn’t provide emulator images themselves), but for the meantime, you can enjoy the emulator with some CyanogenMod 7 Goodies built in.

Simple question: is it possible to install the google-addons in this image?
It would be *possible to distribute an image with google-apps installed on it but I chose not to.
If the app can be installed on user data instead of system, you could use it on this emulator image.
*Possible but illegal.
I’m not asking you to distribuite it, just to write how I can integrate them in the emulator image.
I already know a way of editing a system.img file within the emulator, but I don’t know which files I should add.
Thanks
When compiling, add the CYANOGEN_WITH_GOOGLE=true parameter. You’ll need to get your hands on the google apps so that command will work. Good luck!
Thank you very much Juan!
Hi back, do I need to use the parameter as a bash variable? like
export CYANOGEN_WITH_GOOGLE=true
make
make -j 3 CYANOGEN_WITH_GOOGLE=true
Definately glad to see this. I have a not so normal question though. Do you have any advice on porting CyanogenMod (6.x for me) to a new phone? No one has started a port to my lowly LG Optimus S and I know lots of people would like to see it.
Sorry I can’t help you there. I don’t know much about porting a new device, just compiling already ported devices.
Your best bet would be to try to get in touch with the ‘lots of people’ that would like to see it, and start a fund, buy an Optimus S and hand it over to a CyanogenMod developer. They only support devices they own.
It works really well. As a developer, I like being able to run a different ROM in the emulator.
However, I have a problem:
./adb devices
List of devices attached
Yup, no device is shown. Does this image come with a different identifier?
Hmm, that’s something that I hadn’t checked. I’m updating the Emulator Images in the next few days, now that CyanogenMod has hit RCs and is going to hit stable soon.