In a nutshell, one of the major differences between dedicated server and virtual server is that resources of a virtual server are split between different websites or hosting account while a dedicated server is literally dedicated to your own personal use. You have rights to all of the resources of the machine, and you can configure the hosting environment anyway you wish.
Dedicated servers are most often the fastest and most powerful choices available, although some of the high-end VPS options can give the lower performing dedicated servers a run for their money.
Looking at differences between VPS and dedicated server,one of the major attractions of a dedicated server is that it is generally completely under the control of the customer. Therefore, it can be rebooted when needed and can also be completely customized in terms of the software it runs. Customized software can be very important for a number of reasons, but even if the software is off-the-shelf, not all VPS and shared web providers give their customers carte blanche to install and run additional software.
Virtual private servers has its benefits, although, they are a little harder to get one’s head around than dedicated servers, mainly because dedicated servers are something that nearly everyone can identify with: a computer. Virtual private servers are different from dedicated servers in that instead of running one hosting account on one computer/server, virtual private servers share a single server.
This may cause one to wonder what the difference is between a VPS solution and a shared web host. This is a fair enough question, and there may be variations to the answer depending on who one chooses to ask.
The most basic answer is that shared web hosting plans are mostly offering unlimited bandwidth and often unlimited storage, but there is no promise in regards to the amount of CPU power and/or memory available in most cases. Additionally, there are often restrictions on installing and running CPU/memory intensive modules or software, as hosts may view such software as very disruptive to the other accounts on their server(s).
Considering the differences between dedicated server and virtual server,finding the right balance between price and performance is always a challenge, but remember that you usually get what they pay for. Sadly, sometimes people get less than they pay for too, so be careful when assuming that money alone is a good measure of quality and capacity. Compatibility is also important, and thus sticking with top-tier hosts with established names is probably a good idea for those with serious hosting needs.
For more information, see also Why you should opt for a Virtual Data Center(VDC) instead of a Virtual Server