Upholstery fabric is fabric typically used for furniture and interior or exterior decoration applications. "Upholstery" is the centuries old, constantly improving, methods used to get the webbing, padding, springs, foam and finally the fabric onto a furniture frame to create a chair, sofa, sectional or any other completed piece of furniture.
Upholstery fabric can also be used for drapes, pillow coverings, rugs, and anything else you can imagine. It is generally more robust than something like your average fabric for apparel or bedding. It also tends to have a backing (and sometimes layers) to give it more stability and reliability.
You can't throw your furniture in the washing machine, so the type and quality you choose should reflect the environmental (e.g. sunlight, moisture) and typical usage abuse the fabric must withstand. Upholstery fabric can be used in the home, office, industry, outside, autos, boats and more applications and the fabric for each application can be quite different and specific.