Outlook Personal Folders vs. Archive

Both the Personal Folder and the Archive Folders are Data File Storage to store emails

Personal Folder: Its a personal storage file to have a copies of emails offline. Moving emails from Exchange Online account to a Personal folder will leave you an option to not to access those emails from different outlook account or using webmail (OWA), because of you move the emails to local folder.

Archive Folder: Prior to Exchange Server 2010, It is same like personal folder but with the difference of, In personal folder you manually create a data file storage and you are manually moving the email to personal folder to reduce the size of mailbox, where in archive folder, based on Archive Settings to move certain days old ( default 6 months old) emails from online mailbox to Archive folder.

So both the Personal Folder and Archive folder will have the offline copy of emails in a user computer.

In Exchange Server 2010, MS have a concept of Archive Mailbox, this will look same like archive folder but all the emails will stored in the mailbox itself, If you accessing emails from one machine in 1st floor and from second floor, configure the outlook on different  computer will show all the emails.

Archive mailbox can be used when the company dont want to leave any emails in  a Personal folder or archive folder to monitor all the emails to comply with email policies and regulations.

Please inform if it is not clear.

we use personal folders to backup files from outlook if required outside of the profile - we don't use archive folders.