Definition - What does Virtual Directory mean?
A virtual directory is a path or alias within a website that refers users to another directory where the actual data is hosted. The referred directory can be a physical directory on a local server's hard drive or a directory on another server (network share). The home directory is the root while other directories are virtual directories and are associated with it through aliases.
Virtual directories are used if website admins need to put files in directories other than the home directory and publish from them. They are also used if the admins want to publish from these directories in addition to the home directory. The aliases associated with virtual directories can be single-word names, eliminating the need to type entire paths out to find them on a system's hard drive.
A virtual directory is also known as a virtual directory server.
Techopedia explains Virtual Directory
Users can create virtual directories using Internet Information Services (IIS). When Internet service managers define virtual directories, that's when aliases are associated with them. These aliases are the names that users use to access the data within them. If website administrators do not specify alias names for virtual directories, they will be automatically generated by Internet service managers.
Aliases or the names associated with virtual directories are also shorter than the paths of the physical directories hosting the data. This makes typing them more convenient for users and masks the file locations associated with the server hosting the website. This gives admins greater security, because other users cannot modify the files without knowing their locations.