> This PEP proposes to add to Python a mechanism to automatically recognize a __pypackages__ directory and prefer importing packages installed in this location over user or global site-packages. This will avoid the steps to create, activate or deactivate "virtual environments". Python will use the __pypackages__ from the base directory of the script when present.

Thus, the idea of PDM is that it will create a directory, called `__pypackages__` in the root of your project and in that folder it'll populate all the dependencies for that project. Then, when you run scripts in the root folder of your project, your Python install will see that there's a `__pypackages__` folder and use that folder to look up dependencies.

This style of "dependencies inside the project directory" is similar to how npm of the Javascript ecosystem works, where it creates a `node_modules/` folder in the root of your project and fills that folder with the dependencies for your project. This style of dependency management is different from other package managers such as Poetry (Python), Pip (Python), go (Golang), and cargo (Rust), all of which instead have a sort of "secret folder acting as cache of dependencies at particular versions", a folder that's usually pretty hidden out of the way, in which the package manager automatically manages the acquisition, storage, and versioning/version resolution (Poetry, Go, Cargo, all do this but Pip does not).

That's a very fast and probably wrong rundown on what makes this package manager different from others.

[0] - https://www.python.org/dev/peps/pep-0582/