Vermouth is a fortified wine which simply means that it is a wine strengthened by another wine or spirit.  Fortified wines includes port, sherry, Madeira and vermouth.  These wines are shelf stable and require no refrigeration.  They also last longer than a typical wine.  

There are two kinds of vermouth:  sweet (red) and dry (white).  Both come from white wine but the red is sweetened and colored with the addition of caramel.  Sweet vermouth is typically used as an aperitif while dry is used in martinis and as a cooking liquid. 

The word comes from the German vermut or wermut (wormwood) which is how it was initially flavored.  Today’s vermouth is flavored with varying combinations of flowers, herbs, spices and seeds such as camomile, bitter orange peel, nutmeg, coriander or cloves.  

Dry vermouth can be used in lieu of white wine but since it is fortified it is stronger than white wine and half vermouth and half water should be used to equal the amount of liquid called for in a recipe.