Usually, there are two methods of accomplishing virtual hosting. The first one is name-based and the other one is IP-based. Name-based virtual hosts actually use multiple host names for the same web-server IP address. With browsers that support HTTP, upon connecting to a web-server, the browser sends the address that the client typed into the browser's URL bar. The server is able to use this information to determine which website/page to show to the client. In the latter (IP address based), each site points to a unique IP address and the web server is configured with multiple physical network interfaces which can also obtain the address the TPC connection was aimed for using a standard API. There are no compatibility issues as the client is not involved in this process.

It becomes much harder to access a virtually hosted website if the DNS (Domain Name System) does not function properly. Normally in this case, the user could try and fall back to using the IP address to contact the system but the web browser does not know what host name to send when this occurs. Hence, the server is most likely to respond with a default website, often not the anticipated site of the user. It is not that useful for an average web user but may be beneficial to a site administrator while fixing DNS records. Adding the IP address and host name to the client system's host file is a good thing to do in this case. At this point, accessing the server with the domain name is most likely to work again. The users, however, should be careful as any changes made to the true mapping between IP address and host name will be overridden by the local setting. Another problem with this kind of hosting is the inability to host more than one secure websites running SSL (Secure Sockets Layer). Running IP aliasing or multiple web server programs is a pretty good way to handle this issue.

Virtual web hosting is commonly used in a greater magnitude in companies whose business model is to provide economical website hosting for customers. A big chunk of such web hosting service websites are hosted on shared servers using virtual hosting technology. Some businesses make optimum use of this technology by keeping different intranets and extranets separate from each other for internal security reasons.

Online virtual hosting packages are very common these days which offer a professional look for personal and small business websites. Usually, the monthly charges of these virtual hosting accounts range from fifteen to thirteen dollars. Additional fees are charged with the inclusion of advanced features such as SSL functionality or database software.