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Heart Gold and Soul Silver: Battle Factory
The Battle Factory is located on the east end of the Battle Frontier. Talk to the worker on the left to enter a Single or Double Battle challenge. Talk to the worker on the right to enter a Multi Battle with a friend wirelessly.

The Battle Factory uses rental Pokemon. When you enter the competition you are told what Pokemon your opponent will have, and then you are shown 6 Pokemon and you must choose 3 to use.

Once you win you can either continue with the 3 Pokemon you have or you can exchange one of them for any of the Pokemon you just defeated.

After you're seventh win in a streak you will be awarded 5 Battle Points.