The use of virtualization, along with an efficient virtual machine management, creates a new virtualization layer that isolates the service workload from the resource management. The integration of the cloud within the virtualization layer, can be used to support on-demand resource provisioning, providing elasticity in modern Internet-based services and applications, and allowing to adapt dynamically the service capacity to variable user demands. Cluster and grid computing environments are two examples of services which can obtain a great benefit from these technologies. Virtualization can be used to transform a distributed physical infrastructure into a flexible and elastic virtual infrastructure, separating resource provisioning from job execution management, and adapting dynamically the cluster or grid size to the users' computational demands. In particular, in this paper we analyze the deployment of a computing cluster on top of a virtualized infrastructure layer, which combines a local virtual machine manager (the OpenNebula engine) and a cloud resource provider (Amazon EC2). The solution is evaluated using the NAS Grid Benchmarks in terms of processing overhead due to virtualization, communication overhead due to the management of nodes across different geographic locations, and elasticity in the cluster processing capacity.