Hi There
You must have been away awhile as virtual instruments have been around since the 90s.
A virtual instrument can be a tone generator, a sampler, an effects unit and many other types of equipment.
The difference is that unlike hardware, everything is done in software inside the computer. (Hence the virtual title)
Here are a few links that should help you along, as well as showing you what’s out there. http://www.kvraudio.com one of the best resources for Virtual Instruments
http://www.native-instruments.com Produces of a lot of popular plug-ins
http://www.steinberg.net/24_1.html The inventers of VST instruments
http://www.eastwestsamples.com/formats_and_categories.php Producers of some great plug-ins

There are also computer based keyboards that allow you to load in Virtual instruments, thus allowing you to use them as if they came as part of the instrument. www.wersi.de
http://www.lionstracs.com

You may also like to Google “General Midi” which is a standard adopted by all manufactures so that their instruments can talk to each other, including selecting the correct sounds.
Hope this helps

Bill