A dedicated server is a server that isn't on a shared environment (like shared hosting, reseller hosting, or a VPS would be). You are able to use the actual specs of the server, unlike the usage limits on a shared environment. Basically, it's yours. Do what you want with it.
A dedicated hosting service, dedicated server, or managed hosting service is a type of Internet hosting where the client leases an entire server not shared with anyone. This is more flexible than shared hosting, as organizations have full control over the server(s), including choice of operating system, hardware, etc. Server administration can usually be provided by the hosting company as an add-on service. In some cases a dedicated server can offer less overhead and a larger return on investment. Dedicated servers are most often housed in data centers, similar to colocation facilities, providing redundant power sources and HVAC systems. In contrast to colocation, the server hardware is owned by the provider and in some cases they will provide support for your operating system or applications.
Actually, Dedicated servers "ARE" typically in a "shared environment"... The bw is shared, usually managed such that no one server can cause a problem for the entire network. What is "Dedicated" about it, is the fact that the "server" itself is not shared. It is "dedicated" 100% for the sole use of person who is renting it. Dedicated servers can and do still have certainly limitations on bandwidth.