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virtual folder(1) An index in a computer that points to selected files and folders within that same machine. The Windows 7 Library feature is a virtual folder to the contents on the hard drive (see Windows Libraries). Starting with Windows Vista, the results of a search can be saved as a virtual folder, which is a collection of Shortcuts to the real items.
(2) An index in a computer that points to files and folders on a remote server. For example, an online backup service may let users view their files on the backup servers using the file manager (Explorer, Finder, etc.) in their computers.
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