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It is a great idea to make many normal computers together to get a super computer, and this computer can do a lot of things. This is the concept of cloud computing. Cloud computing is an emerging model of business computing. And it is becoming a development trend. This article compares cloud computing and grid computing. Internet has connected all the computers in the world. Grid computing has been put forward under this background. Its core concept is to complete computing based on compute grid, in it every computer will devote power. In recent years a new concept cloud computing has been put forward, it can connect millions of computers to a super cloud. This article also introduces the application field the merit of cloud computing, such as, it do not need user's high level equipment, so it reduces the user's cost. It provides secure and dependable data storage center, so user needn't do the awful things such storing data and killing virus, this kind of task can be done by professionals. It can realize data share through different equipments. The users need not know how the cloud runs. In this paper I describe the concept of cloud computing and grid computing and compare them.