Integrated graphic cards are like those from Intel.
Intel GMA series is an example of integrated graphic card.
They have a small amount of dedicated memory and share some memory from your RAM.
As a result, the performance of integrated graphic cards are penalised because they occupy the system bus.

Dedicated graphic cards are usually from  Nvidia and ATI.
They have their own dedicated memory and might share extra memory from the RAM,too.
However, dedicated graphic cards have larger dedicated memory and better processors.
They do not occupy the system bus as much as integrated graphic cards.
As a result, the performance of dedicated graphic cards are better compared to integrated ones.