Virtual Hosting is another term for shared hosting. It means that you are hosted on a server that hosts numerous domains accounts with the same computer software and hard drive. The different domains files are separated by the server software and folders permisions so that there is no way for people to access the wrong domains files.

The alternative to a shared or virtual hosting set-up would be a "dedicated server". A dedicated server is where you are given an entire computer to yourself to host your files and sites. This allows you faster performance and more space as well as the flexability to control more things within the server itself. This however is more geared toward professionals who maintain and host sites professionally or for other clients and know how to manage and maintain a web server.