MSDE is a scaled-down version of the SQL Server engine that's free to install and distribute. It's similar to SQL Server, except for a few limitations:
It supports only five simultaneous users.
It doesn't include any graphical tools to help you design tables, monitor performance, and perform general database maintenance. However, you can use Visual Studio .NET and its Server Explorer to gain some basic database manipulation abilities.
It can't host a database larger than 2 GB.
MSDE is an ideal platform for testing ADO.NET code if you don't have a SQL Server database handy. You can even install it alongside an instance of SQL Server if you don't want to test with a production server. Best of all, databases created in MSDE can be easily migrated to a SQL Server installation.
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