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A complete computer running as software: the basic unit of cloud computing.
Quick Definition
A virtual machine (VM) is a software-based emulation of a physical computer, with its own operating system, running on shared physical hardware. VMs are a fundamental cloud compute unit, provisioned on demand and billed by size and runtime.
A virtual machine, or VM, is a full computer, processor, memory, disk, operating system, that exists as software running on shared physical hardware. One physical server hosts many isolated VMs, which is the trick that makes cloud computing possible: providers slice giant data centers into rentable machines of any size, billed by the second.
VMs are the cloud's basic unit and its basic cost driver. Every size choice is a price choice, and because VMs feel like real servers, they inherit real-server habits: oversized for safety, left running around the clock, forgotten after projects end. That makes them the first place rightsizing and scheduling look for savings.
Example. A development VM sized like production runs 24 hours a day but is used 8 hours on weekdays. Rightsizing it and scheduling it off nights and weekends cuts its cost by more than 80 percent.
VMs sit on a spectrum: containers share an operating system and start faster, serverless removes the machine concept entirely. Each trades control for convenience differently. The cost optimization guide covers VM-level savings, and the AI workload VM guide addresses the expensive GPU-backed variety.
Functionally it behaves the same; physically it shares hardware with other VMs. Isolation is enforced by a hypervisor layer.
Size, family, region, and hours running, multiplied by pricing model. On-demand, reserved, and spot rates for the same VM differ by up to 90 percent.
When workloads are many and small, or traffic is spiky. VMs still suit steady, heavy, or legacy workloads needing full OS control.