Difference between web Site & Web Application

Hello friends,
Is there any differenece between Web Application and Web Site. where I can get the details about this?
One more thing I amusing Visual Studio 2005, now if I select File > New > Project I dodn't found any option for Web Application there. So ultimately I have to select File > New > Web Site.
Is it normally like this only or I have to do something to include Web Application option into New > Projects.
Please let me know
Thanks & Regards
Girish Nehte
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