Reseller hosting is a form of web hosting wherein the account owner has the ability to use his/her allotted hard drive space and bandwidth to host websites on behalf of third parties. The reseller purchases the host's services wholesale and then sells them to customers, possibly for a profit. A certain portion of hard drive and bandwidth is allocated to the reseller account. The reseller may rent a dedicated server from a hosting company, or resell shared hosting services. In the latter case, the reseller is simply given the permission to sell a certain amount of disk space and bandwidth to his own customers without renting a server from a web hosting company he signed for a reseller account with. Regards
I would like to add a few words here, many web hosting companies are actaully reseller as they lease rackspace in data centers owned by other companies.