Sorry for asking this basic question. But I am not having on-premise Dynamics CRM instance, and so I cannot verify this from my end, and also I couldn't find this information online.
As On-premise deployment allows multi-tenant architecture, i.e., one instance can host multiple organizations. Does it mean that there will be one database for one organization? Or if there is a single database for all organizations?
I am more interested into learning about On-premise deployment, but I don't have resources to play around. So just thought to get this info in form of answers
Each organization in Dynamics CRM has its own database, and there is one server configuration database, with each CRM installation, called MSCRM_CONFIG.
Each organization is independent of the others. For example it can host different users and it can have totally different customizations.
One important thing that is to note (in my opinion), is that very frequently it may happen that you may need to move one organization to a different server, or create a copy of an organization on the same server. In this case, when moving to another server you only need the organization database, to copy and restore it to another server, and then import it through the Deployment manager. This will be sufficient and you do not need the MSCRM config database in this case, to have the same organization running on a separate server. This is of course you don't have advanced configuration on the database such as database mirroring, or load balancing.
See attached image, to see how databases look like in SQL Management studio, of Dynamics single server installation. Each database in red, ending with _MSCRM ia a separate organization, and the one in yellow (as its obvious), is the MSCRM_CONFIG database.