Many web hosting services offer so-called unlimited or unmetered service for whatever amount of bandwidth, disk storage and sites you use. It's important to understand that most terms of service actually do limit the definition of "unlimited" to what's considered reasonable use. The bottom line is simple: if you're building a pretty basic website, unlimited means you don't need to worry. But if you're trying to do something excessive (or illegal, immoral or fattening), the fine print in the terms of service will trigger, and you'll either be asked to spend more or go elsewhere.
Unlike shared or VPS hosting, dedicated hosting makes your website the lone tenant on a server. To extend the housing metaphor, having a dedicated server is like owning your own home. The means that your website taps the server's full power, and pays for the privilege. If you're looking for a high-powered site—an online mansion for your business—dedicated hosting is the way to go. That said, many dedicated web hosting services task you with handling backend, technical issues, much as homeowners have manage maintenance that renters generally leave to their landlords.