Described is a technology in which one application running in a browser can host another application (e.g., an advertisement) in an isolated manner that prevents the hosted application from accessing browser data, or data of any other hosted application (including the host). The host and/or hosted application may be a browser plug-in (e.g., Microsoft® Silverlight™) application. The host application privately instantiates a hidden plug-in, with that hidden plug-in's access to browser data disabled, and loads the hosted application in the hidden plug-in. A XAML tag element may be used to identify the hosted application, along with a rendering area for the hosted application. Content from the hosted application is composited with content from the host application when rendering. The host application may provide keywords to the hosted application, such as for selecting relevant advertisements, and/or may allow the hosted application to open a browser window to display associated website content.