A virtual machine (VM) is a software-based emulation of a physical computer. It runs an operating system and applications just like a real computer, but it operates within a host system. This allows multiple VMs to run on a single physical machine, sharing its resources such as CPU, memory, and storage. Virtual machines are commonly used for testing software, running different operating systems, and isolating applications. They provide flexibility and efficiency, as users can easily create, modify, or delete VMs without affecting the host system. Technologies like VMware and VirtualBox are popular tools for managing virtual machines.