Is Windows Vista compatible with Microsoft Office 2007?

In a Word: Yes.

From the Wikipedia entry on Office 2007: "Office 2007 requires Windows XP with Service Pack 2 or higher, Windows Server 2003 with Service Pack 1 or higher, or Windows Vista." Office 2007 System Requirememts: Windows XP SP2, Windows Vista, Windows Server 2003 SP1 500Mhz or faster processor 256mb RAM or more 1.5GB Hard Drive space 1024 x 768 or higher resolution monitor Windows Media Player 9 or higher Microsoft DirectX 9.0b