Instance-based learning, also known as lazy learning, is a non-parametric learning method where the training data is stored and a new instance is classified based on its similarity to the nearest stored instances. It is similar to a desktop in that all data is kept in memory. The key aspects are setting the K value for the K-nearest neighbors algorithm and the distance metric such as Euclidean distance. Training involves storing all input data, finding the K nearest neighbors of each test instance, and classifying based on the majority class of those neighbors.