That's a very good, and interesting question. And "What's a workstation?" can also mean, in a sense "What's a server?" We need to make that distinction in order to answer your question.
Generally, at home there is no need to make a workstation/server distinction, because really the home only has one or two or so PCs, and they are there to (primarily) perform user level functions like reading e-mail, surfing the net, playing games, using Microsoft Office and so forth.
In a workplace, LAN environment, one generally gets these kinds of machines AND WE GET SERVERS. We have to make some kind of distinction because workstations (which are really just like the home PCs mentioned above) are very different from the functions of servers. Generally speaking, the use of the word "workstation" in preference to "PC" would indicate an environment that has servers.
We seperate machines being "workstations" from "server" by their software roles alone (although servers often have type of hardware technologies not on workstations, but this in itself itsn't the distinction) - servers provide "services" such as being a domain controller (consolidating of authentication and user management), DNS (the mapping of host names to IP addresses), Relational Database Management Systems (Like Oracle or MS SQL Servers). Its the software functionality that makes a machine a "workstation" or a "server" and that's really the only criteria.
Thusly, a small 200 MHz machine with Linux installed with Apache and used as a web server would be called a server, but a massive, dual processor machine with RAID-5 and heaps of RAM (although it would be suitable hardware wise for many server functions) is still a workstation if its loaded with Windows XP and used to do user level things those I mentioned above (web surfing, e-mail, office, etc).
So, really you have to make the distinction based on the role the machine has. If its used for user level functions as mentioned above, then its a workstation. If its providing services (such as domain controller, DNS, RDBMS, web server, e-mail server, etc) then its a server.
Its not entirely accurate to seperate "workstations" from "servers" according to their types and flavours of operating system (but its a very good place to start) however here are some OS distinctions, for Microsoft:-
Server
Windows NT Server
Windows 2000 Server (or Advanced Server, Datacenter Server)
Windows 2003 Server
Workstation
Windows 2000 Professional
Windows XP
Windows 95 or 98
Linux distributions are capable of configuring themselves to be workstations or servers, depending on in the installation of certain services, or not (i.e. DNS, DHCP, Web, Mail, etc). But you do get certain Linux distributions more suited to workstation or server functions. For the various other kinds of UNIXes floating around I guess this is the case too, however there are many UNIXes that are only suitable as servers.
In another sense, when viewed from the point of view of the execution and delivery of certain services, workstations can also be called clients (thusly client/server methods, server side scripting, etc), and a workstation can also be a host. In network architectures, a client station (user's machine) is also considered a host, because it is a source of information to the network in contrast to a device such as a router or switch that directs traffic. But servers could be called hosts as well.
So, remember that we make these distinctions based on WHAT THE MACHINE DOES - not on how beefy its hardware is. Plenty of people make that mistake and wind up making asses of themselves. Remember what I have said and you won't be one of them.
). I get one of those every month now.
