I recently saw a feature in Unity’s Player Settings named Virtual Texturing. I tried looking for Unity Documentation but couldn’t find much.

Unity Editor:

Can anyone explain what this feature is and how it works in Unity. More importantly, should I enable it?

>Solution :

Unity User Manual 2021.3 (LTS)

Streaming Virtual Texturing

This feature is experimental and not ready for production use. The feature and documentation might be changed or removed in the future.

Streaming Virtual Texturing (SVT) is a feature that reduces GPU memory
usage and texture loading times when you have many high resolution
textures in your Scene . It splits textures into tiles, and
progressively uploads these tiles to GPU memory when they are needed.

Unity is playing catchup on this front with Unreal Engine’s Virtual Texturing feature which is available since at least 4.26.

More importantly, should I enable it?

You can enable it and play with it, see how it behaves, but since it’s experimental it is not recommended in a production environment.