Microsoft SQL Server 2008 provides tools and features to optimize performance for both individual servers and large databases. It allows databases to scale up using a single server's resources more efficiently or scale out across multiple servers. Key features include the Resource Governor to control resource allocation, Performance Studio to monitor instances across an enterprise, and partitioning to enhance concurrency and reduce disk contention. SQL Server 2008 also supports techniques like peer-to-peer replication and Service Broker to scale out databases across multiple servers.