Is a DApp also hosted like web application. As i know that smart contracts are stored in the blockchain but what happened with the UI part?
You need to understand the difference between Ethereum clients such as geth, pyethap, alethzero, etc. and their available interfaces.
See the sketch below:
Local client (127.0.0.1:4000) ------> Local Eth client (http://127.0.0.1:8000) ------> Bootstrap node Eth client (eth://<pub_key>@<IPv4>:30303)
Where the local client is any (web3 code running in a browser, JSONs sent as arguments to command line tools such as curl, wget, etc.) application capable of sending JSON objects in POST requests through a socket to the local Ethereum client (listening by default on 127.0.0.1:8000).
Note that the application sending commands to the local eth client in JSON objects does not have to be running on the same box as the eth client itself. However, as of now, it is recommended since clients do not yet support mutually authenticated TLS tunnels thus being susceptible to MITM attacks.