VPS hosting, or Virtual Private Server hosting, is a powerful and flexible web hosting solution that offers the best of both shared hosting and dedicated server hosting. In a VPS hosting environment, a physical server is divided into multiple virtual servers using virtualization technology. Each of these virtual servers operates independently with its own dedicated resources, including CPU, RAM, storage, and bandwidth. This isolation ensures that the performance of VPS is not affected by the activities of other users on the same physical server.