The type of cloud service that provides virtualized computing resources is known as Infrastructure as a Service (IaaS). IaaS delivers foundational computing resources such as virtual machines, storage, and networks on a pay-as-you-go basis. This allows businesses to scale infrastructure according to their needs without the burden of managing physical hardware. IaaS is crucial for organizations transitioning to cloud-based operations, providing flexibility, cost savings, and the ability to quickly respond to changing demands in the business environment.