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what is overselling?

It's merely allowing the person to use more space and transfer than they have been given by default or something like that.
Overselling — a practice of selling more server hard disk space and bandwith than is actually available at the given moment. So, you have 10 GB, but you sell 20 GB. You’re oversold by 10GB. This is a common practice on shared plans as most accounts never use more than 10% of their allocated resources.
Overselling is actually pretty good - for webhosts who can do it right.

I mean.

Say you got a server with 160GBs.
All the accounts you have on it will use 155GBs at max quota.

However current usage is only 70GBs.

It would be a waste to close down the server, just put more and more accounts on it - once more space is required, install another HD.

IMO is very last thing you should look at when selling resources from servers is how much space is left, the most important things IMO are CPU and Uplink speed, then RAM, then Space.
Starcraftmazter said:
the most important things IMO are CPU and Uplink speed, then RAM, then Space.
Agreed, but I'd say the ram is second cause that'll cause alotta bad things if there isnt enough available.
That's true.

I guess it would depend on users with a lot of CPU intensive scripts against users with a lot of RAM intensive scripts.

Of course you always need a bit of both, and it's not always easy to reach a "sweet spot".

It's also important to make sure nobody is using more than their fair share, no use paying $100 extra monthly for resources only one account is using.
What is overselling? Can someone explain?
When a web host oversells, it's exactly the same as when an airline oversells. When done responsibly everything flows smoothly, when not done sensibly things can go wrong. :)
Overselling is as usual business practice, used in many online and offline businesses. Reseller overselling is basically when a host allows a reseller to oversell their resources i.e selling more than the available resources.
IMO, Overselling only becomes a bad thing when its abused and starts to hinder server performance. It is responsibility of the reseller that offering the service to stay up to its promises and in this case I think the reseller is solely liable for overselling. :classic2: