Volume Shadow Copy (VSS) technology is built into Windows XP and Windows 2003 and newer operating systems. It allows open files to be copied by creating a virtual copy of a file while it is being backed up. The file can remain open and continue to be accessed by other programs while the backup is running. Once the shadow copy is created subsequent updates to the file are not included in the backup, however, they are written to the original file as normal.
For more information see: http://technet2.microsoft.com/WindowsServer/en/library/2b0d2457-b7d8-42c3-b6c9-59c145b7765f1033.mspx?mfr=true
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