You need to use diff command to display line-by-line difference between two files. The general syntax of diff command as follows:
diff FILE1 FILE2

Where,
FILE1 FILE2: Diff command will examine both file1 and file2 and tells you what changes need to be made for file1 and file2 to match. Please note that diff command point to which lines need be:

1. Added (a)
2. Deleted (d)
3. Changed (c)
4. Further lines in file1 identified with a less than () symbol and lines in file2 with a grater than (>) symbol.

Examples

diff file1.txt file2.txt

Output:

8c8,9
 URL: www.nixcraft.in
> Email: support@nixcraft.in

The contents of both files:

$ cat file1.txt

Output:

Welcome to nixCraft!

If undeliverd return to nixCraft
#404, DC bay area, 2nd phase,
Pune.

Ph: 555-11112223
URL: www.nixcraft.com

$ cat file2.txt

Output:

Welcome to nixCraft!

If undeliverd return to nixCraft
#404, DC bay area, 2nd phase,
Pune.

Ph: 555-11112223
URL: www.nixcraft.in
Email: support@nixcraft.in

Side-by-side merge of file differences
You can get a clear-cut visual difference between two text files using the command sdiff:

$ sdiff file1.txt file2.txt

Output:

Welcome to nixCraft!                                            Welcome to nixCraft!

If undeliverd return to nixCraft                                If undeliverd return to nixCraft
#404, DC bay area, 2nd phase,                                   #404, DC bay area, 2nd phase,
Pune.                                                           Pune.

Ph: 555-11112223                                                Ph: 555-11112223
URL: www.nixcraft.com                                         | URL: www.nixcraft.in
                                                              > Email: support@nixcraft.in

REFERENCES

http://www.cyberciti.biz/faq/how-do-i-compare-two-files-under-linux-or-unix/