Steinberg updated the VST interface specification to version 2.0 in 1999. They released it at the same time as Steinberg Cubase 3.02, which included the first VST format plugins: Espacial (a reverb), Choirus (a chorus effect), Stereo Echo, and Auto-Panner. Steinberg released the VST interface specification and SDK in 1996. For example, the output of a VST synthesizer can be sent through a VST reverb effect. Most host applications can route the audio output from one VST to the audio input of another VST ( chaining). MIDI messages can control both instrument and effect plugin parameters.

(Some effect plugins also accept MIDI input-for example, MIDI sync to modulate the effect in sync with the tempo). Effect plugins receive digital audio and process it through to their outputs. VST instruments receive notes as digital information via MIDI, and output digital audio.

This lets musicians and recording engineers use virtual versions of devices that otherwise might be difficult and expensive to obtain. These typically emulate the look of the original equipment as well as its sonic characteristics. VST instruments include software simulation emulations of well-known hardware synthesizers and samplers. Some (often older) plugins rely on the host application for their user interface. VST plugins usually provide a custom graphical user interface that displays controls similar to physical switches and knobs on audio hardware. Most VST plugins are either instruments (VSTi) or effects (VSTfx), although other categories exist-for example spectrum analyzers and various meters. VST plugins generally run within a digital audio workstation (DAW), to provide additional functionality, though a few standalone plugin hosts exist that support VST.

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