A virtual private network (VPN) extends a private network across a public network, and enables users to send and receive data across shared or public networks as if their computing devices were directly connected to the private network. Applications running across a VPN may therefore benefit from the functionality, security, and management of the private network.[1]

VPN technology was developed to allow remote users and branch offices to securely access corporate applications and other resources. To ensure security, data would travel through secure tunnels and VPN users would use authentication methods – including passwords, tokens and other unique identification methods – to gain access to the VPN. In addition, Internet users may secure their transactions with a VPN, to circumvent geo-restrictions and censorship, or to connect to proxy servers to protect personal identity and location to stay anonymous on the Internet. However, some Internet sites block access to known VPN technology to prevent the circumvention of their geo-restrictions, and many VPN providers have been developing strategies to get around these roadblocks.

A VPN is created by establishing a virtual point-to-point connection through the use of dedicated connections, virtual tunneling protocols, or traffic encryption. A VPN available from the public Internet can provide some of the benefits of a wide area network (WAN). From a user perspective, the resources available within the private network can be accessed remotely.[2]
Traditional VPNs are characterized by a point-to-point topology, and they do not tend to support or connect broadcast domains, so services such as Microsoft Windows NetBIOS may not be fully supported or work as they would on a local area network (LAN). Designers have developed VPN variants, such as Virtual Private LAN Service (VPLS), and Layer 2 Tunneling Protocols (L2TP), to overcome this limitation.

Source: https://en.wikipedia.org/wiki/Virtual_private_network