If i set up a disk quota does the user get a special partion or can it be on my regular partion?
It's a regular partition that has been mounted with quota-support. Also, your kernel needs to support quotas.
For more information on quota do a research in the forum please since these kind of questions have been answered a couple of times already
As a general start with quotas you might find http://www.tldp.org/HOWTO/mini/Quota-4.html