Web Application Projects versus Web Site Projects

In Visual Studio you can create Web application projects or Web site projects. Each type of project has advantages and disadvantages, and it is helpful to understand the differences between them in order to select the best project type for your needs. You must select the appropriate project type before you create a project, because it is not practical to convert from one project type to the other.

The following table summarizes the main differences:

Area	Web application projects	Web site projects
Project file structure	A Visual Studio project file (.csproj or .vbproj) stores information about the project, such as the list of files that are included in the project, and any project-to-project references.	There is no project file (.csproj or .vbproj). All the files in a folder structure are automatically included in the site.
Compilation	You explicitly compile the source code on the computer that is used for development or source control. By default, compilation of code files (excluding .aspx and .ascx files) produces a single assembly.	The source code is typically compiled dynamically (automatically) by ASP.NET on the server the first time a request is received after the site has been installed or updated. You can precompile the site (compile in advance on a development computer or on the server). By default, compilation produces multiple assemblies.
Namespaces	Explicit namespaces are added to pages, controls, and classes by default.	Explicit namespaces are not added to pages, controls, and classes by default, but you can add them manually.
Deployment	You copy the assembly to a server. The assembly is produced by compiling the application. Visual Studio provides tools that integrate with the IIS Web deployment tool to automate many deployment tasks.	You copy the application source files to a computer that has IIS installed on it. If you precompile the site on a development computer, you copy the assemblies produced by compilation to the IIS server. Visual Studio provides tools for deployment, but they do not automate as many deployment tasks as the tools available for Web application projects.

Know more details:
- http://msdn.microsoft.com/en-us/library/dd547590.aspx