A virtual private server(VPS), also called a virtual dedicated server (VDS), is a virtual server that appears to the user as a dedicated server but in fact is installed on a server that like shared hosting has multiple users and hosts multiple websites. In other words it is a type of virtualization that enables a virtual server, which is a shared resource to mimic a dedicated hosting environment with its own operating system and dedicated resources like bandwidth, memory, RAM, etc.
A hybrid of shared hosting and dedicated costing, virtual dedicated server hosting seeks to combine the power and control of dedicated hosting with the cost effectiveness of shared hosting. A VDS has its own dedicated set of resources like bandwidth, RAM, CPU, memory, storage, etc. The virtually space provided to the account holder is capable of running its own operating system and all the software and applications supported by that operating system.
VPS in which a physical server is virtually partitioned, is significantly more powerful, reliable, secure and flexible than shared hosting, and is appropriate for one or more moderate- to high-traffic sites and ecommerce stores. The VPS alternative is often chosen by small businesses that need a customized Web site but do not possess the financial or technical resources to have their own dedicated servers.