VRAM, is a dedicated form of memory used on Graphics cards and is designed specifically to hold graphical data, things such as textures, positional data, frame buffers, shaders and other graphical assets that a GPU needs to process a scene quickly and have the next one ready to go.
Games and more recent titles need increasing amounts of VRAM, this can be to load high resolution textures and for processing Ray Tracing with the latter requiring a lot memory more than was needed in the past.
Without this, games run more slowly as they use the slower system memory which is not designed for this so as a result runs more slowly. You can see this sometimes when a game lags, or stutters. Even so far as to badly loading a texture, if you have ever played a game and are confronted by a glaring pink or green box or a black void where a surface should be, that could be the cause.
As games become more complex, with higher resolution textures, and layering of textures.
A key reason for the recent jump in VRAM requirements is Ray Tracing, processes such as Global Illumination which is used to recrate realistic lighting, soft shadows and how light bounces off surfaces. This and other related processes generate vast amounts of data which is needed rapidly by the GPU.
Another factor is resolution, a 4K image is four times the size of a 1080p image so the file will be larger as a result.
Much like other parts of your PC you can easily look this up, often it is labelled on your GPU box, otherwise you can access this through windows either typing "Advanced Display" into your start menu or typing "system info" and looking for the GPU in the menu.
With all current GPUs the VRAM is pre soldered to the GPU circuit board itself and cannot be upgraded. There for the only way to increase your VRAM is to replace the GPU with a model that has a higher amount.