Hi Abhishek,

Please find the explanation below.

Sites: Force.com Sites enables you to create public websites and applications that are directly integrated with your Salesforce organization—without requiring users to log in with a username and password. ... You can publicly expose any information stored in your organization through a branded URL of your choice.


Custom Portal:-A Salesforce Customer Portal provides an online support channel for your customers—allowing them to resolve their inquiries without contacting a customer service representative. With a Customer Portal, you can customize and deliver a visually stunning user interface to your customers, and use the following Salesforce features to help you and your customers succeed.

Use Of Custom Portal:The Salesforce customer portal is generally geared toward providing you a way to allow your customer's to see information that relates only to their account with you; things like their Account and Contact information, maybe the contracts they have on file with you, their Assets, etc. The primary limitation of a customer portal is that the portal user can only view their own account information.

For more information please check with below links:

• http://www.kineticgrowth.com/salesforce-communities-customer-partner-portals/
• http://salesforce.stackexchange.com/questions/15846/whats-the-difference-between-portal-and-newly-introduced-salesforce-community
• http://help.salesforce.com/help/pdfs/en/salesforce_portal_to_community_migration_cheatsheet.pdfhttp://help.salesforce.com/help/pdfs/en/salesforce_portal_to_community_migration_cheatsheet.pdf

Hope this helps.

Please mark it as solved if it's resolved.

Best Regards,
Nagendra.