Kind of but also not really.

Docker is one kind of container, which itself is a set of kinds of Linux namespaces.

It's possible to run them as if they were a virtual machine with LXC, LXD, systemd-nspawn. Those run an init system and have a whole Linux stack of their own running inside.

Docker/OCI take a different approach: we don't really care about the whole operating system, we just want apps to run in a predictable environment. So while the container does contain a good chuck of a regular Linux installation, it's there so that the application has all the libraries it expects there. Usually network software that runs on a specified port. Basically, "works on my machine" becomes "here's my whole machine with the app on it already configured".

And then we were like well this is nice, but what if we have multiple things that need to talk to eachother to form a bigger application/system? And that's where docker-compose and Kubernetes pods comes in. They describe a set of containers that form a system as a single unit, and links them up together. In the case of Kubernetes, it'll even potentially run many many copies of your pod across multiple servers.

The last one is usually how dev environments go: one of them have all your JS tooling (npm, pnpm, yarn, bun, deno, or all of them even). That's all it does, so you can't possibly have a Python library that conflicts or whatever. And you can't accidentally depend on tools you happen to have installed on your machine because then the container won't have it and it won't work, you're forced to add it to the container. Then that's used to build and run your code, and now you need a database. You add a MongoDB container to your compose, and now your app and your database are managed together and you can even access the other containers by their name! Now you need a web server to run it in a browser? Add NGINX.

All isolated, so you can't be in a situation where one project needs node 16 and an old version of mongo, but another one needs 20 and a newer version of mongo. You don't care, each have a mongo container with the exact version required, no messing around.

Typically you don't want to use Docker as a VPS though. You certainly can, but the overlay filesystems will become inefficient and it will drift very far from the base image. LXC and nspawn are better tools for that and don't use image stacking or anything like that. Just a good ol' folder.

That's just some applications of namespaces. All of process, network, time, users/groups, filesystems/mount can be independently managed so many namespaces can be in the same network namespace, while in different mount namespaces.

And that's how Docker, LXC, nspawn, Flatpak, Snaps are kinda all mostly the same thing under the hood and why it's a very blurry line which ones you consider to be isolation layers, just bundled dependencies, containers, virtual machines. It's got an infinite number of ways you can set up the namespaces the ranges from seeing /tmp as your own personal /tmp to basically a whole VM.