Editing scripts?
 

My hosting company tells me that I need to optimize my scripts by editing them to use less system resources. I have no clue what this means, and I slightly feel like they're just saying this to shut me up. I continuously experience down time w/ them & they say that it's my websites fault because we use too many system resources. Honestly - we're a small website & I know they've hosted larger ones before.

Can anyone help? I'm at a loss of how to handle things.

It isn't so much how many users (although, of course that has an effect) but which Mods you have installed and how 'active' those users are. Some Mods are much more server intensive than others. Which modifications do you have installed?

Link to your site so we can see what mods you have installed.

There are also a ton of vBulletin options you can disable or set to run 1 time an hour to help decrease the load.

Or you could just switch hosts

How much are you paying for hosting, and how many users on average do you have online at the same time?

I would say this is a fair assessment. Most budget hosting doesn't do too well with modded vBulletin. Budget hosting means more users per server and less resources for your site. Get some quality hosting and you don't get silly excuses like "modify your scripts for less resource usage".

Once you get over 150 users online at once, you'll have to consider options beyond shared hosting but it doesn't sound like your'e there yet.