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To quote from the Technet documentation (and I'm quoting the first paragraph of the first link which comes up for the search term "sql server instance definition" in Google): "An instance of the Database Engine is a copy of the sqlservr.exe executable that runs as an operating system service. Each instance manages several system databases and one or more user databases. Each computer can run multiple instances of the Database Engine. Applications connect to the instance in order to perform work in a database managed by the instance." [More information here.][1] Please do try to search for information before posting to get others to impart it ([as I mentioned when answering your previous question a month or so ago][2]) - that way you will get your answer more quickly, and other people will take you more seriously when you have tried and gotten stuck. If you can show where your confusion is then you may get a more targeted answer which will help you more. [1]: http://technet.microsoft.com/en-us/library/hh231298.aspx [2]: http://ask.sqlservercentral.com/questions/108389/m-new-to-sql-sever-technology-please-let-me-know-w.html