Tar & ZIP are two most commonly used utilities in Linux system TAR is archiver utility which will archive the selected files or directories. Extension of TAR is .tar. gz is known as gunzip used compress files only. Extension of gz is .gz. You can use gz on TAR to compression directories achieved by TAR. ZIP is archiver and compression utility for files and directory. Extension of ZIP is .zip. The benefit of TAR can be applied on directories. Sometimes, you do not want to compress the filer but want to bundle them, TAR is perfect for it. TAR with GZIP is the best combination. Like GZIP, we also have bzip2 which use a completely new algorithm to compress files has given less size in compare to gzip.