web.Config: Web.Config file is maintained within a 
particular Web application and the Configuration setting 
specified within web.config file is applicable to that 
application only.

Machin.Config: Machin.Config file is maintained within .Net 
framework derectories and configuration setting within 
Machin.Config file affects all the managed application 
deployed on that machin

1. web.config and machine.config both are the configuration 
files
2. web.config files contains settings specific to a web 
application, machine.config file contains settings to 
computer.
3. configuration system first searches settings in the 
machine.config file next look at web.config file
4. web.config file exists within the web application, 
machine.config file exists in the 
c:\windows\microsoft.net\framework\version\config file
5. if we remove web.config file it does not contains any 
connection string settings the web application will run, if 
we remove machine.config file no one windows and web 
application will run.