As far as the programs on your computer are concerned, a RAM Disk is the same as any other volume. The difference is that it is actually located in RAM.
The advantage is that it is extremely fast; the disadvantages are that it is usually quite small (unless you can afford stupid amounts of RAM) and that when you turn off your computer, all the information on the disk is deleted.
RAM Disks in the Mac OS are automatically copied to the hard disk when the system is shut down. However, this doesn't help if you experience a power cut.
RAM Disks are also known as RAM Drives.