  We present a next-to-leading order calculation of jet production in
gamma^*gamma collisions from e+e- scattering in a region where the virtuality
Q^2 of the probing virtual photon is small compared to the transverse jet
energy. The calculation is based on the phase-space slicing method. The initial
state singularity of the virtual photon is factorized into the structure
function of the virtual photon, using the MS-bar factorization scheme for
virtual photons. Numerical results are presented for LEP2 conditions. The
perturbative stability of the pure direct virtual photon approach is compared
to that of including resolved virtual photons in different regions of Q^2. We
make predictions for cross sections which suggest that different
parametrizations of virtual photon parton densities should be distinguishable
by measurements of jet cross sections at LEP.
