A virtual IP address, often known as a VIPA, is a public IP address that many Internet-connected devices may share. Each device has a different local IP address internally, but they all use the same one publicly.

In home and workplace networks, VIPs are prevalent. The router normally uses DHCP to provide each connected device a distinct local IP address when it first joins the network. The router's IP address is 192.168.0.1, whereas examples of local IP addresses are 192.168.0.2, 192.168.0.3, etc. Some routers assign IP addresses 10.0.1.2, 10.0.1.3, etc. using the IP address 10.0.1.1. Through network address translation, local IPs are combined into a single public (or "virtual") IP address (NAT). The devices on the Internet are identified by their virtual IP addresses.

Servers also make advantage of VIPs. For instance, many web servers may use the same IP address to distribute requests among their various workstations. A "high availability" server, for example, may have a single IP address shared by two different machines. This is helpful for load balancing and redundancy.