What is the difference between the Power BI Desktop and Power BI Service (PowerBI.com)?

The Power BI Desktop is the complete report authoring tool for report designers. It is downloaded as a free application and installed on a local computer. The desktop allows you to connect to different types of data sources and then transform it in a data model. The final part of the report creation process is to add visuals based on the data model.

The Power BI Service is the cloud-based service where users view and interact with the reports. Report designers use the Desktop application to publish the Power BI reports to the Service. Users in the Service can edit the reports and create visuals based on the existing data model and also share and collaborate with co-workers.

There are a small number of areas where the Desktop and Service overlap. However, most implementations use the Power BI Desktop to create the reports and then use the Service to distribute the reports with others.