Early versions of HTTP (like many other protocols, e.g. FTP) required a different IP address for each virtual host on the server. On some platforms this can limit the number of virtual hosts you can run, and because there are concerns about the availability of IP addresses it is strongly discouraged by the registraries (ARIN, RIPE, and APNIC).
The HTTP/1.1 protocol, and a common extension
    to HTTP/1.0, includes a method for the server to
    identify what name it is being addressed as. Apache 1.1 and
    later support this approach as well as the old
    IP-address-per-hostname method.
The benefits of using the name-based virtual hosts is a practically unlimited number of servers, ease of configuration and use, and it requires no additional hardware or software. The main disadvantage is that the client must support this part of the protocol. Almost all browsers do, but there are still tiny numbers of very old browsers in use which do not. This can cause problems, although a possible solution is addressed below.
Using name-based virtual hosts is quite easy, and
    superficially looks like the old method. The notable difference
    between IP-based and name-based virtual host configuration is
    the NameVirtualHost
    directive which specifies an IP address that should be used as
    a target for name-based virtual hosts, or the wildcard
    * to indicate that the server only does name-based
    virtual hosting (no IP-based virtual hosting).
For example, suppose that both www.domain.tld
    and www.otherdomain.tld point at the IP address of
    your server. Then you simply add to one of the Apache
    configuration files (most likely httpd.conf or
    srm.conf) code similar to the following:
    NameVirtualHost *
    <VirtualHost *>
    ServerName www.domain.tld
    DocumentRoot /www/domain
    </VirtualHost>
    <VirtualHost *>
    ServerName www.otherdomain.tld
    DocumentRoot /www/otherdomain
    </VirtualHost>
    Of course, any additional directives can (and should) be
    placed into the <VirtualHost> section. To
    make this work, all that is needed is to make sure that the
    names www.domain.tld and
    www.otherdomain.tld are pointing to the right IP
    address.
Note: When you specify an IP address in a
    NameVirtualHost directive then requests to that IP
    address will only ever be served by matching
    <VirtualHost>s. The "main server" will
    never be served from the specified IP address.
    If you specify a wildcard then the "main server" isn't used at
    all. If you start to use virtual hosts you should stop using
    the "main server" as an independent server and rather use it as
    a place for configuration directives that are common for all
    your virtual hosts. In other words, you should add a
    <VirtualHost> section for every server
    (hostname) you want to maintain on your server.
Additionally, many servers may wish to be accessible by more
    than one name. For example, the example server might want to be
    accessible as domain.tld, or
    www2.domain.tld, assuming the IP addresses pointed
    to the same server. In fact, one might want it so that all
    addresses at domain.tld were picked up by the
    server. This is possible with the ServerAlias
    directive, placed inside the <VirtualHost> section. For
    example:
    ServerAlias domain.tld *.domain.tld
    Note that you can use * and ? as
    wild-card characters.
You also might need ServerAlias if you are
    serving local users who do not always include the domain name.
    For example, if local users are familiar with typing "www" or
    "www.foobar" then you will need to add ServerAlias www
    www.foobar. It isn't possible for the server to know
    what domain the client uses for their name resolution because
    the client doesn't provide that information in the request. The
    ServerAlias directive is generally a way to have
    different hostnames pointing to the same virtual host.
As mentioned earlier, there are still some clients in use who do not send the required data for the name-based virtual hosts to work properly. These clients will always be sent the pages from the first virtual host listed for that IP address (the primary name-based virtual host).
There is a possible workaround with the ServerPath
    directive, albeit a slightly cumbersome one:
Example configuration:
    NameVirtualHost 111.22.33.44
    <VirtualHost 111.22.33.44>
    ServerName www.domain.tld
    ServerPath /domain
    DocumentRoot /web/domain
    </VirtualHost>
    What does this mean? It means that a request for any URI
    beginning with "/domain" will be served from the
    virtual host www.domain.tld This means that the
    pages can be accessed as
    http://www.domain.tld/domain/ for all clients,
    although clients sending a Host: header can also
    access it as http://www.domain.tld/.
In order to make this work, put a link on your primary virtual host's page to http://www.domain.tld/domain/ Then, in the virtual host's pages, be sure to use either purely relative links (e.g., "file.html" or "../icons/image.gif" or links containing the prefacing /domain/ (e.g., "http://www.domain.tld/domain/misc/file.html" or "/domain/misc/file.html").
This requires a bit of discipline, but adherence to these guidelines will, for the most part, ensure that your pages will work with all browsers, new and old.
See also: ServerPath configuration example