Lemmy.world is just 1 instance/server. Each instance/server is controlled by different people. Each instance/server can choose to(or not) group with other instances/servers for shared content all around, thats what people refer to as federated or federation.
Theres actually a handful of lesser known social media and video services that can run like this, including Mastadon and Peertube.
Here you can see all the different instances https://join-lemmy.org/instances i believe lemmy.world is currently the biggest. Remember litterally ANYONE can start an instance so the content can be questionable on some instances.