Server runs the web app, web server, etc. or any other web application related stuff, which can be called the Web Tier.
Database server runs separately, to handle all the stored data related operations, and connected with the main server, which can be called the Data Tier.
It is good for situations when there is large set of data to be written and retrieved from the database.
This will divide the processing and memory usage for both app related and database related operations as they both have separate dedicated power, processor, memory, and storage.
This won't block the main web app, as any data tier related request will be delegated to the database server.