Stereo preamps or as most commonly referred to as a stereo preamplifier within a home audio stereo system is generally used to describe equipment that switches between different external line-level sources such as a cd player, dvd player, mp3 player or satellite/cable box and applies a volume control. In addition to a volume control, equalization or tone controls may also be applied.
In a home audio system, the second amplifier is typically a power amplifier (power amp). The preamplifier provides voltage gain to raise or lower the power amplifiers output but provides no significant current gain. It is the power amplifier that provides the higher current necessary to actually drive your loudspeakers.
Stereo preamplifiers are generally found in three forms; in a stand alone separate component as seen on this page, integrated into a single chassis with an amplifier (see integrated amplifiers) or integrated with an amplifier and an AM/FM tuner (see stereo receivers). Stand-alone stereo preamplifiers as exemplified here offer the highest performance and system flexibility while stereo receivers, although more cost-effective does so at the expense of both performance and flexibility.
If you find that a separate stand alone stereo preamplifier as part of a complete separates stereo system is prohibitive to your budget, you may want to explore the many different options available to you in an intregated amplifier solution. Integrated amplifiers offer an excellent balance between price, high-performance and size. That said, a separates system still offers the very highest performance, flexibility in which people who own them will tell you that the musical rewards are well worth their extra cost.