Geotargeting, or geographical targeting, is a way for website to display content specific by means of distribution of ads, news to a particular geographical area. For example, you can use a place name in your keyword, such as "India Web Design". Some search engines allow you to target specific countries and languages without using keyword relevance.
Geo targeting happens on the server, before the page is sent to the browser. When a user requests a page from the server, the server queries the user's IP address against a database of worldwide IP addresses. The database identifies the country (sometimes even city!) of the user's IP address, and then the server decides what to do.
Geotargeting is important for Internet Marketing and Localization.