They are both a hardware _and_ software requirement.

Pixel shaders (and shaders in general) are part of your video card (or GPU) hardware. However, you also need a version of DirectX or OpenGL* recent enough that it'll be able to take advantage of your video card's capabilities - otherwise they might as well not exist.

Wikipedia has a list which covers [the maximum shader version supported by various video card series][1].

<sup>* In case you are unaware of their role, DirectX and OpenGL are drivers which act as the go-between between your game and your video card.</sup>

[1]:http://en.wikipedia.org/wiki/Pixel_shader#Hardware