When we are talking about a term environment along with Python, it is a context in which our Python application runs, or we can say that the Python program runs.
An environment consists of an interpreter and all the installed packages, which clearly means that one can have multiple environments on a single machine, or rather I would say, every Python application can have its own environment.
Now the question is, why do we need such environments? To know more about the virtual environment and how to create one using Visual Studio Code, have a look at my below video,