you did not specify if win 7 is upgrade version, or full version (can be a OEM copy).
If it is the full version, no you do not need to have XP installed.
If it is the upgrade version - it requires the operating system being upgraded to be installed. With vista they did away with just using the CD/DVD for verification that you qualify for the upgrade. Vista had a "work-around" and I do not know if that will be available with Win 7. PS will find out when my copy of win 7 upgrade arrives.