How does vertical scaling differ from horizontal scaling of a system?

Vertical scaling (scale-up) means increasing the resources of a single server: adding processors, RAM, disk space. This improves the performance of one machine but has physical and economic limitations.

Horizontal scaling (scale-out) involves adding new servers to the system, distributing the load among them. This approach provides better fault tolerance and scalability but requires the implementation of distributed algorithms and load balancing.

Example: if a database on a powerful single server cannot handle the load, vertical scaling — increase the resources of that server, horizontal — add several servers with replication or sharding.