Terraform vs CloudFormation – What’s the Difference (Pros and Cons)

Terraform vs CloudFormation – What’s the Difference (Pros and Cons). Terraform and CloudFormation are referred to as software that defines infrastructure, which helps your IT team to provision and manages your infrastructure with different tools. Selecting the right Infrastructure as Code (IaC) framework depends largely on your needs and can have a significant impact on your cloud native tech stack. Due to the rise of IT, Infrastructure as Code (IaC) has now become the pillar of implementing DevOps.

Infrastructure as Code (IaC) manages, updates, and provisions computer data centers by implementing comprehensible virtual files. The IaC means infrastructure is designed as a code, enabling users to alter and supply configurations concurrently while ensuring the appropriate state of the infrastructure. Moreover, it is used to resolve Environmental Drift issues in the release pipelines.

Hence, infrastructure as code has eradicated the tradition of the manual approach of doing a job and provided us with a simple computing approach to accelerate our working speed, prevent the risks of manual error, decrement of financial waste, and minimize the efforts. 

Talking about Infrastructure as Code (IaC), Terraform and Cloudformation software have imperative roles in establishing infrastructure. It helped in organizing and provisioning the infrastructure with multiple tools.

When it comes to the best means to operate infrastructure, automatically, two notorious tools pave their way to our minds. Therefore in this article we will compare Terraform vs CloudFormation – What’s the Difference (Pros and Cons)and we hope it will assist you in choosing the best tool for your project/company.

What is Terraform?

Terraform is an open source and non proprietary software created by Hashicorps. It permits the establishment of Infrastructure as Code (IaC) and uses infrastructure as code in managing, updating, and provisioning the series of infrastructures. The feature Configuration file and Version Control allow users to define the whole infrastructure.

Terraform is divided into two modules: the first one is Terraform Core which looks after the graphs of a resource plan, execution, and configuration files, and the second one is Terraform Plugins which is operated for defining resources for various services.

Terraforms Enterprise is a paid feature offered by Hashicorp that renders Sentinel used in implementing Policy as Code.

The programming language on which terraform is based is Hashicorp Configuration Language (HCL), which is well matched to JavaScript that assists DevOps users in developing IaC. Terraform uses the configured infrastructure components to manage, adjust, and alter infrastructure in different Cloud Providers.

Pros of Terraform

  • Infrastructure as Code: Infrastructure is described using a high level configuration syntax.
  • Terraform supports multi cloud integration. 
  • Terraform has a robust CLI. Terraform modules allow to separate resources in dedicated and re usable templates.
  • It is open source and easily accessible.
  • It retains the history of alteration in an environment through terraform state management that can be helpful in long term projects.
  • Execution Plans: Terraform has a “planning” step where it generates an execution plan. The execution plan shows what Terraform will do when you call apply.
  • It has a plug in rooted architecture that accumulates the capability of the IaC suite anytime.
  • A dependency graph can be created through Weka.
  • It renders uniform syntax for IaC.
  • It supports a Multi Tier application, and each layer has its group of resources.
  • It allows users to alter, write, and modify the configurations for the SDN services.
  • Terraform has workspaces, which makes it easier to manage multiple environments.

Cons of Terraform

  • Expensive enterprise plan.
  • Security of “state files” is a concern because managing the resources is impossible if the terraform state is ever lost.
  • It’s complicated while using a local files.
  • It does not support any revert function for wrong/invalid changes to resources.
  • Terraform is difficult to debug.
  • Difficult to operate the existing stacks. 
  • It does not contain GUI.

What is CloudFormation?

Next part of the guide Terraform vs CloudFormation – What’s the Difference (Pros and Cons) is the CloudFormation. It is a product of Amazon Web Services (AWS). It is a platform that assists in operating Infrastructure and enables users to create their AWS resources that aids execution of AWS based applications.

Moreover, It is used to deploy Infrastructure as a Service. Cloudformation handles the configuration in a JSON format called templates. These templates enable the user to attain re usability and scalability of infrastructure. Cloudformation templates can also be in YAML format.

It uses templates to build stacks. The templates are stored in buckets, and the buckets are visible to every user through Amazon Simple Storage Service. The stack of AWS resources is known as a template.

CloudFormation is responsible for the configuration of resources so that you don’t have to create and configure the AWS resources manually. It offers a wide range of approaches to create a module such as import/export out values or nested stacks.

Pros of CloudFormation

  • Infrastructure as a Service.
  • AWS CloudFormation comes with the following ready to run sample templates: WordPress (blog),Tracks (project tracking), Gollum (wiki used by GitHub), Drupal (content management), Joomla (content management).
  • By operating one template, you can deploy many instances of the same resource which is more convenient and faster than the manual method of deployment.
  • The templates offered by Cloudformation can be repetitively used.
  • It enables you to scale up the environment with Cloudformation Templates.
  • The amalgamation of multiple AWS cloud services is effortlessly done.
  • While the deployment of AWS resources enables you to put the same configuration repeatedly.
  • The GUI of Cloudformation is up to the mark.

Cons of CloudFormation

  • It enables only five hundred resources to be added per template.
  • Poor at handling traffic, sometimes due to traffic, you have to manually remove the stacks.
  • It does not have the ability to change the name of the pile after deployment.
  • It does not provide vast services because it is confined to only AWS services.
  • The documentation for Cloudformation is quite ardent to understand for amateur or beginners.

Terraform vs CloudFormation Pros and Cons

Both Cloudfrmation and Terraform offers excellent features to reduce the workload and groom the current status of IT.

Furthermore, both tools have similar approaches. Still, there are some differences between the tools which make them stand alone. Otherwise, both offer services related to Infrastructure as Code (IaC).

Now this part of article of Terraform vs CloudFormation – What’s the Difference (Pros and Cons) we will compare both with a graph like feature with main functionalities.

Terraform CloudFormation
The state is deposited on a local disk.

It has Out-of-box that manages the condition.

It offers the services and features of AWS and foreign parties.
It provides the benefits and features related to AWS only.
Modules in Terraform are managed/created as a group.
It contains multiple approaches to develop the modules, such as import/export out values or nested stacks.
It provides you with the list of changes required.
You can confirm changes through Using Change Sets.
Terraform stores the states in a virtual machine or remote computer in the form of a JSON file. That file provides the map of detailed information of resources it is keeping An eye on.
AWS is responsible for State-management; it Constantly maintains the states and provides the detailed feedback.
It supports Hashicorp Configuration Language (HCL), which is also similar to JSON.
It supports Javascript Object Notation (JSON) or Yet Another Markup Language (YAML) languages. Both are easily understandable.
Users only have to pay for the enterprise version of Terraform. Otherwise, it is also free of cost
Users have to pay for AWS services. Otherwise, Cloudformation is free.
It does not provide Wait-condition.
It offers a Wait-condition that enables users to apply Breakpoints to the templates.
Rollbacks out of the box are not provided by Terraform
CloudFormation has the capability to jump back to the last working state whenever any failure or error occurs

Terraform vs CloudFormation – What’s the Difference (Pros and Cons) Conclusion

Terraform main difference is its Infrastructure as Code service where Infrastructure is described using a high level configuration syntax where.

CloudFormation uses Infrastructure as a Service. Terraform is a great choice for your project, if you have a multi cloud architecture but CloudFormation is explicitly built for AWS.


Terraform that requires users to save the state in a JSON file but CloudFormation stores its state with stacks, making it easy to avoid conflicting changes.  

AWS CloudFormation comes with the following ready to run sample templates but Terraform big advantage is Execution Plans: a “planning” step where it generates an execution plan. The execution plan shows what Terraform will do when you call apply. 

Hence, Terraform and CloudFormation are both vital and robust tools. Both have invested an imperative role in alleviating the complexities and efforts in managing and provisioning the infrastructures. In this article, we have discussed Terraform and CloudFormation in every aspect so that you can easily select tools according to your needs and requirements of the project.

Avatar for Emad Bin Abid
Emad Bin Abid

I'm a software engineer who has a bright vision and a strong interest in designing and engineering software solutions. I readily understand that in today's agile world the development process has to be rapid, reusable, and scalable; hence it is extremely important to develop solutions that are well-designed and embody a well-thought-of architecture as the baseline. Apart from designing and developing business solutions, I'm a content writer who loves to document technical learnings and experiences so that peers in the same industry can also benefit from them.

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