Equipment height is often stated in "rack units," where 1U (one unit) is 1.75 inches, 2U is 3.5 inches, and so on. When racks are built for equipment, the "rack rails" have holes in them that correspond to this spacing. Therefore equipment of any size (as long as it's a multiple of 1.75 inches) can be mounted.
The standard for rack equipment is established as a 19 inch width between the center of holes on opposite rails, with 1.75 inches designated as the "standard" height of a space.