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What is the difference between Web application and Web site? Sometimes it looks that it is used interchangeably?

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These terms are synonymous. That being said, it is my own experience and understanding that the term Web Application was created/coined for developers who at one time developed Windows/Desktop Applications, who migrated their skill set over to web development. This is prevalent in technologies like ASP.NET, where the development environment and lifecycle closely relates to that of Windows Forms development.

All of that said, you will probably get a different/varying answers based on the background of any individual responding to the question.

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Originally website meant what you got when you pointed your browser at a web server. It was as though you gone to a physical place, like a section of a library, you were presented with a static collection of pages. Now that analogy doesn't apply to everything you could point your web browser at. For example, RememberTheMilk is a "website" in that it is a collection of pages, but in concept it is a tool for making lists, it is a list-making application that you access using your browser; a web application.

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