Windows Phone 8 application development allows developers to use Visual C#, Visual Basic and Visual C++ to develop applications for Windows Phone 8. In the release of the WP8 SDK, Microsoft actively stopped development of XNA in February 2013 allowing developers to code games in a managed .NET Framework language.[22] The development community has had mixed reaction to this decision; some in quite strong terms. The XNA framework (a wrapper around DirectX) has been discontinued in favor of DirectX for Windows Runtime and Windows Phone apps forcing developers to use native code to build games. There are third party alternatives to XNA such as MonoGame that allow developers to continue using XNA in Windows Runtime, WP8 and in other platforms. The emulator has also been changed to use Hyper-V as the hypervisor and now requires Windows 8 Pro or Windows Server 2012 64 bit editions, and a system that supports hardware assisted virtualization. to run. WP8 supports a subset of Windows Runtime objects for code reuse between Windows 8 and Windows Phone 8 platforms. Native code support has been added to WP8 but it can only be used to build DirectX games or Windows Runtime components. Apps that use XAML must still be built with managed .NET Framework languages. A limited support of a subset of Win32 APIs have been added in the WP8 SDK. Microsoft has also added support for third party game frameworks such as Unity to make it easier for developers to port apps to Windows Phone. Developers can still develop WP7 apps and it would continue be compatible with Windows Phone 8.

Source: WikiPedia