With the advent of resource shared environments such as the Cloud, virtualization has become the de facto standard for server consolidation. While consolidation improves utilization, it causes performance-interference between Virtual Machines (VMs) from contention in shared resources such as CPU, Last Level Cache (LLC) and memory bandwidth. Over-provisioning resources for performance sensitive applications can guarantee Quality of Service (QoS), however, it results in low machine utilization. Thus, assuring QoS for performance sensitive applications while allowing co-location has been a challenging problem. In this thesis, we identify ways to mitigate performance interference without undue over-provisioning and also point out the need to model and account for performance interference to improve the reliability and accuracy of elastic scaling. The end goal of this research is to leverage on the observations to provide efficient resource management that is both performance and cost aware. Our main contributions are threefold; first, we improve the overall machine utilization by executing best-effort applications along side latency critical applications without violating its performance requirements. Our solution is able to dynamically adapt and leverage on the changing workload/phase behaviour to execute best-effort applications without causing excessive interference on performance; second, we identify that certain performance metrics used for elastic scaling decisions may become unreliable if performance interference is unaccounted. By modelling performance interference, we show that these performance metrics become reliable in a multi-tenant environment; and third, we identify and demonstrate the impact of interference on the accuracy of elastic scaling and propose a solution to significantly minimise performance violations at a reduced cost.