To emulate a computer or multiple computers on another computer.

To virtualize a computer we copy the hard drive and use software on another computer to load it into a virtual computer.   Each virtual computer has a pretend processor, disk, RAM, network card, display adapter, and anything a real computer has.   It runs as if it is its own program, can be copied from computer to computer, and it can manage it’s network interface like a real network card.

Programs that run in virtualized computer environments have a hard time determining the difference.

Virtualization allows for componentization of software. Isolating certain services from others. The Web Server and Database server should not exist on the same computer, what if the web server was tricked to serve files from the database. That could be catastrophic for the business operating the website. But if the website is not able to access the files of the database server because they are on a different Virtual Computer, then that provides a convenient layer of security without having to to purchase more hardware.

VirtualBox.org is a great way to learn about using virtual computers. If you need to run a development server a virtual computer is a great way to recreate the production environment.