Vertical and horizontal scaling are two approaches to increasing a system's capacity, each with distinct advantages and disadvantages. Vertical scaling, or "scaling up," involves enhancing an existing machine's capabilities, which can be cost-effective and simpler for single-machine maintenance but presents a single point of failure and inherent limitations. Conversely, horizontal scaling, or "scaling out," adds more machines to distribute the workload, offering greater resilience and potentially higher performance, especially for mission-critical systems, but can be more complex and costly upfront. The choice between the two depends on various factors, such as cost, future growth, uptime, and performance requirements, with horizontal scaling being preferable for high-availability needs and vertical scaling potentially suitable for systems with lower demands.