Terraform and AWS CloudFormation are two popular IaC tools for automating cloud resources, differing in usability, multi-cloud capabilities, state management, etc.
Terraform is open-source, written in HCL, supports multi-cloud—AWS, Google Cloud, Microsoft Azure, and on-prem infrastructure.
CloudFormation is Amazon’s native IaC tool that uses JSON/YAML templates, provides integration with AWS services, and handles resource creation, update, and deletion.
Terraform’s multi-cloud support makes it ideal for hybrid or multi-cloud strategies, while CloudFormation is AWS-specific, tailored for AWS services, and integrated with the AWS ecosystem.
HCL syntax in Terraform makes it more human-readable and intuitive, whereas CloudFormation templates are written in JSON or YAML which can be more verbose and difficult to manage with larger templates, with nested stacks allowing for some modularity.
Terraform maintains a state file that records the current status of infrastructure, while CloudFormation does not, simplifying usage but reducing granular control over state, which can be challenging while working in teams.
Terraform provides informative error messages for debugging; CloudFormation has built-in rollback functionality that automatically attempts to revert to the last known stable state, making it more robust for large scale deployments.
Terraform has the concept of provisioners to execute scripts on resources after creation, which CloudFormation doesn’t support, while AWS recommends using services like AWS Lambda for similar outcomes.
Terraform supports integrations with compliance tools like AWS Config and Cloud Custodian, making it more flexible for companies with complex needs, while CloudFormation integrates with AWS Config and Organizations making it easier to implement compliance rules and security policies.
Terraform itself is free and open-source, while with CloudFormation, there could be indirect costs involved depending on the resources deployed.