Local applications run directly on a user's device, relying on local storage and processing power, while cloud-based applications operate via the internet, utilizing remote servers for data storage and processing. Local apps can offer faster performance and offline access, whereas cloud applications provide easier collaboration and accessibility from any device. Additionally, cloud apps often feature automatic updates and scalability, but they depend on internet connectivity. Ultimately, the choice between local and cloud applications is influenced by factors like cost, performance, and specific user needs.