As you may have correctly assumed by the acronym, a Virtual Local Area Network is a network that is not a physical Local Area Network. It is a logical network that is created on physical network infrastructure. Rather than create many physically separated networks with its own hardware, VLANs allow for many separate networks on the same physical hardware. See the following physically separated network without the use of VLANs. Each network can be set to a different subnet on the router:
A “router on a stick” (aka “one-armed router”) is a network configuration in which a single network switch is connected to a single LAN interface on a router. The network switch may be configured to have two or more VLANs to logically partition the network. The router is responsible for inter-VLAN routing so that network traffic may flow from one VLAN to another. This traffic is usually controlled via firewall rules to restrict certain traffic.