What is a VPS and how does it work?

By ONIE Engineering Team · Updated November 12, 2026 · 3 min read

A VPS (virtual private server) is a virtual machine that behaves like a small, separate computer on the internet. It has its own operating system, its own IP address, a reserved share of CPU and memory, and a disk only you can read. You log in over SSH (Linux) or Remote Desktop (Windows) and install whatever software you need. If you want to try one, you can rent a VPS by the hour and delete it when you are done.

How a VPS works

One physical server runs a hypervisor. On Linux this is usually KVM, which is built into the kernel. The hypervisor splits the machine into several isolated virtual machines. Each one gets a fixed number of virtual CPU cores (vCPU), an amount of RAM and a virtual disk. Because the resources are reserved for each machine, a busy neighbour cannot take them away, which is the main difference from shared hosting.

A cloud VPS adds an automation layer on top. You create, resize, snapshot and delete servers from a web console or an API instead of waiting for a technician, and many providers bill by the hour.

What people use a VPS for

  • Websites and online shops, including WordPress.
  • Web applications and APIs with their own database.
  • Game servers and voice servers.
  • A personal VPN, a proxy or a small mail relay.
  • Development, testing and CI runners.
  • Remote desktop on a Windows VPS.

VPS compared with other options

Shared hostingVPSDedicated server
ResourcesSharedReservedA whole machine
Root accessNoYesYes
Typical useSmall sitesSites, apps, databasesHeavy, steady load

Read VPS vs shared hosting for a longer comparison.

What to check before you buy

  1. vCPU, RAM and disk. Start from what your software needs; see how to choose VPS specs.
  2. Disk type. NVMe is much faster than a spinning disk for databases and busy sites.
  3. Location. Pick a data center close to your visitors to keep latency low.
  4. Billing. Hourly billing suits tests and short projects; prepaid cycles are cheaper for servers that run all year.
  5. Backups and snapshots. Decide how you will restore the server if something breaks.
  6. Protection. Ask whether DDoS filtering is included and what the firewall options are.

Note that most providers, including ONIE, keep billing a stopped server because its resources stay reserved. Delete the server to stop charges.

Your first steps on a new VPS

After the server starts, connect with SSH, update the system and create a normal user. On Ubuntu:

ssh root@YOUR_SERVER_IP
apt update && apt upgrade -y
adduser deploy && usermod -aG sudo deploy

Then follow the guide to secure SSH on a Linux VPS before you install anything else.

Frequently asked questions

Is a VPS the same as a cloud server?

Almost. A cloud server is a VPS that you manage through an API or console, with fast creation and usually hourly billing. In everyday use the two names mean the same thing.

Do I need technical skills to use a VPS?

You need basic command-line skills for a Linux VPS, or Remote Desktop for a Windows VPS. You are responsible for updates and security, so follow a setup guide.

Is a VPS faster than shared hosting?

Usually yes for demanding sites, because the CPU, RAM and disk are reserved for you instead of shared with other accounts.

Sources and further reading

More VPS guides