SLRs are better for Pros, but probably not you

The answer to your question depends a lot on your needs and finances.

Generally digital compacts are smaller, lighter, less expensive, less likely to be able to take technically challenging pictures, and have worse picture quality than digital SLRs.

However Compacts do take great pictures, and are great values, if youre an average photographer. You dont use the camera professionally, you like to take pictures of family events and outings, email copies to friends, and rarely intend to make poster-sized prints. You and your friends will probably never notice the difference between your pictures and ones you could have taken with a Digital SLR, and you wont miss the extra features you would rarely have taken advantage of unless your want to document sporting events.

Digital SLRs get better quality results and are always the choice of professionals who require the extra quality, and more the extreme flexibility that they can buy especially with all the professional attachments that are available for their cameras.

Digital SLRs start with larger imaging sensors, and because the sensors are larger, they inherently tend to give better picture quality, even when the sensors have the same mega pixel rating. The tiny dots on the sensor are further apart and that lessons the problem associated when the light from an object tends to fall on the edge of one sensing dot and bleed over to the one next to it, which slightly blurs the result. Larger sensor produce sharper images with less blur. The larger sensor size has a drawback.

Each time the sensor size is doubled, the camera must gather 4 times the amount of light, to expose the image properly. Digital SLRs have big sensors, which must be housed in big cameras and use big heavy lenses. The body on most Digital SLRS is larger than many Compacts, and most people who use SLRs have several lenses.

Digital SLRs usually accept a full line of accessories that range from lenses to flash support that can make shots that are impossible to get with Compacts possible, but that extra capability isnt cheap. The question you have to ask yourself is do you need that extra capability, and is it worth the trouble to carry it around, and the price you would have to pay to get it? To most people, including most who own the SLRs, the answer is clearly NO. If they own SLRs they usually got them for the same reasons they own Ferraris and benefit from them in the same ways.

If you compare the pictures from both side by side, most people wont notice any difference until they print enlargements, and even then, if you didnt have the SLR print right next to the Compact version, youd think the Compact was pretty darn good. There is no difference when you drop them down to a size you can view easily in emails or share 4 x 6 prints with your friends.

The only real downside to a Compact for most people is the limitations of its flash. If you dont have one that can accept an external flash, your flash range will be very limited, often around 10 feet. That has no effect on most peoples party pictures, and no effect at the beach or even most outdoor sporting events. However if you want to capture your childs athletic accomplishments from the sidelines, at night, youre going to need serious lighting equipment that doesnt work with most Compacts, and incidentally will probably cost you more just for the lighting than you would have spent on your Compact.

My recommendation is that unless you feel compelled to one up your friends, get a good Compact and in 5 years when the new Compacts are better than their SLR, buy one. Your friends will still be paying off their big, heavy, and super expensive SLRs. Get one that accepts good flash, and if you want to add that capability you can, when you need it.