A folder on a computer is very similar to the physical folder. Both contain papers or files and are used to organize these files. The icon for a folder even looks like a physical folder.
A file is a piece of saved information. Files are stored within folders, just like files in an office filing cabinet. Computer files can be a variety of formats, including documents, images, videos, audio and more. The icon for a file is generally similar to that of the program that is able to open it.