While shared hosting is best for personal sites and startups, VPS hosting wins for larger sites and small businesses. VPS is more expensive than shared hosting, but in return, you get more flexibility over your resource limits, as well as greater security and improved performance.
If you are very new to hosting with small site and very less experience then Shared hosting is best suitable for you.
If you have huge visitors for your website and know how to manage VPS, VPS are like virtual dedicated server, you will share only bandwidth with other user.
With VPS hosting you'll still be sharing one physical server, but each user gets a specified set of resources, meaning that other websites on the same server won't affect you, unlike with shared hosting. VPS hosting provides a dedicated virtual partition for each user, making sure resources are always available to you.
Another feature of the VPS is the ability to create sandboxes and honeypots. These are methods of testing software updates and features while keeping the main site secure. Your company uses one of its VPS partitions for its main site and another one as a backup.
Nice VPS hosting deals you can get at Rockhoster.com - It has nice reliability, easy to use control panel and excellent customer support.