In early 2004 while searching the Internet for a tool that would assist our team in performing peer code reviews I stumbled upon a compare and merge application that has since become an integral part of the developer experience for me and many developers I know. Araxis Merge 6.5 was so impactful on our team that I wrote a review of the product at the time for the .NET Developers Journal, everything I wrote in the review still holds true today although Araxis Merge 2010 has become all the more impactful as it has evolved over the past six years.
While many developers are familiar with the compare and merge tools that are provided by configuration management suites such as Team Foundation Server, they are also often familiar with their limitations. One such limitation with many such tools is that they can advise you that a given line has changed although they are unable to specify which characters on that line are different.
Araxis Merge 2010 is able to advise which characters within a line have changed and also does an excellent job of maintaining an awareness of which lines in one file relate to lines within a second file, or even a third file in the case of three way compare and merge in the professional edition. Applying the difference from one file to another is also made extremely easy by simply selecting the arrow button that appears on the line between the different areas of the file and can be applied in either direction.
If you're developing on the 64-bit version of Windows, and there really is no reason to still be using 32-bit Windows, there is a natively compiled 64-bit version.
Without a doubt, Araxis Merge 2010 is the best compare and merge tool on the market today, in my humble opinion that is, and I have it integrated into the Visual Studio 2008 SP1 environment such that I no longer have to endure the limitations of windiff.exe.
I would highly recommend any developer take the time to download Araxis Merge 2010 and kick the tires and see how it compares with the compare and merge tool you're using today. I'd also recommend taking a look at the integration page on their Website for details on how to configure Araxis Merge 2010 to replace the built-in compare and merge tool within Visual Studio 2010.