The answer to your question is It's a physical system that is not affected by any other system. They don't really exist, other than the universe.
You might incorrectly state that an object is space is isolated from everything else, and it does seem that way. It's still affected by gravitational fields, but negligibly.
However, you look at the universe which you define to be everything ever. There is nothing else that exists to interact with it, so it is an isolated system.
