A VPN is a secure 'tunnel' across the internet linking together to or more Local Area Networks (LANs). A good example (with picture) is shown at: http://www.draytek.co.uk/support/vpn_setup.html

Practical uses

The situation where this has proved useful is where the directors or partners of a business, quite often work from home. They need to be able to access their files from home and the VPN allows them to do that; however, it should noted that the speed of data transfer is dependent on both on upload and download connection speed. Nevertheless, it does enable them to work from home and the addition of an IMAP mail server means that they can see their mail exactly as they see it in the office.

HOWTO

There are excellent HOWTO's on the Draytek site.