HTTP Web Site Type:-
ASP.Net 3.5 Support the HTTP web site or you can say remote web sites. This option is a
good choice when IIS installed on the developer computer.
The remote computer must have IIS installed and must be configured with Front Page server Extensions installed.
Local IIS Web Site:-
If you want to create web pages on your local computer and you have Installed IIS.
A Local IIS web site is suitable if you want to make your site access to another computer.