It's both. It has 2 handheld modes I believe (I don't have one myself), one where you hold it by the controllers on the sides, another where you prop the stand up on the back and detach both controllers which have enough buttons to be full controllers for 2 people (you can sync up 2 additional separate controllers and have 4 players on a "handheld"). It can also sit in a dock that has video out to a TV, where "normally" you'd get better video quality, although I think most reviews I've seen have mentioned a lot of games aren't really optimized for docked mode, so the quality's about the same.