The term VPS hosting stands for “Virtual Private Server” hosting. In essence, a VPS server is one machine that is divided into multiple different machines that act like a stand-alone server. This allows one physical machine to function as a server for multiple websites, keeping each virtual machine separate from one another.
Buying or renting an entire server just for one website is an expensive process and usually only recommended for extremely busy websites that require a lot of processing power. For most WordPress websites, you’ll only need a slice of that server’s storage space and power, which is where VPS hosting comes in.
The benefit of using VPS hosting is that it offers a more affordable, lean experience that is usually more than adequate for most websites. The downside, however, is that if a lot of different websites are all sharing the same server and are busy at the same time, this may slow down response time from the server.
Several different third-party companies offer VPS hosting, but WordPress.org does not.
For your own personal computer, if you’ve ever used a “sharing” program like VMWare or Virtual PC, then this is the same concept as VPS hosting. They both create a “virtual” and separate operating system environment where you can execute programs and tasks without the data or commands affecting the rest of the computer. For instance, it’s possible to create a “virtual” Macintosh operating system inside of a computer that is running Windows.
VPS hosting offers exactly the same functionality for your WordPress site. For information about pricing and operability issues, you’ll need to contact the third-party company (not WordPress.org) that is providing VPS hosting services.