Horizontal scalability refers to the ability of a system to handle increased load by adding more machines or nodes rather than upgrading existing hardware. This approach allows for distributing the workload across multiple servers, which can improve performance and reliability. For example, a web application can scale horizontally by adding more servers to manage user requests. This method contrasts with vertical scalability, where a single machine is upgraded with more powerful components. Horizontal scalability is often favored in cloud computing environments, such as those provided by Amazon Web Services or Google Cloud, because it offers flexibility and cost-effectiveness in managing resources.