vSphere defines VMware's virtualization product suite, including the ESXi hypervisor, vCenter management server, and vSphere Client interface. ESXi uses a proprietary kernel called vmkernel along with some open source components. Key features of vSphere include VMware HA, vMotion, and DRS for managing and migrating VMs across hosts. Troubleshooting performance issues involves tools like esxtop to monitor CPU, memory, and swap usage on ESXi hosts and VMs.