What is Amazon VPC?
VPC stands for Virtual Private Cloud. For a typical VM in AWS, there are restrictions on IP address assignments. VPC allows you to configure servers and network access points without restrictions. It allows you to leverage AWS with your own network in a separate data center. It is ideal for hybrid clouds or situations where you need full control of networking without the constraints of typical AWS deployments.
An RDS instance will be created in a VPC by default. To configure a VPC, see this posting. See this posting for more information about using RDS as an example of a VPC. To learn more about VPCs in general, see this link.
Amazon Virtual Private Cloud (Amazon VPC) lets you provision a logically isolated section of the AWS Cloud where you can launch AWS resources in a virtual network that you define. You have complete control over your virtual networking environment, including selection of your own IP address range, creation of subnets, and configuration of route tables and network gateways. You can use both IPv4 and IPv6 in your VPC for secure and easy access to resources and applications.The above quoted paragraphs were taken from this link.
You can easily customize the network configuration for your Amazon VPC. For example, you can create a public-facing subnet for your web servers that has access to the Internet, and place your backend systems such as databases or application servers in a private-facing subnet with no Internet access. You can leverage multiple layers of security, including security groups and network access control lists, to help control access to Amazon EC2 instances in each subnet.