These settings control which differences you consider important in the current session. Important differences will be colored red in the comparison. Unimportant differences will be blue (or not highlighted at all if View > Ignore Unimportant Differences 
is marked).
Unimportance
Text that matches items defined in this list are considered unimportant.
Grammar elements
Mark the boxes in the list of items that are important to the comparison.
Leading whitespace controls whether whitespace at the start of the line is important.
Embedded whitespace controls whether whitespace in the middle of the line is important.
Trailing whitespace controls whether whitespace at the end of the line is important.
Everything else refers to non-whitespace text not already defined as a grammar element.
Mark the Character case checkbox if the "everything else" text is case-sensitive. (The case sensitivity of grammar elements is controlled by the file format's grammar.)
Click the Edit Grammar button to examine or change the grammar definitions in the selected file format.
Miscellaneous
To consider an extra blank line (or an inserted line with only unimportant text) an important difference, mark the Orphan lines are always important checkbox.
Beyond Compare normally ignores differences in line ending style, such as CR+LF in Windows text files vs. LF only in Unix files. To find differences in line endings on a line-by-line basis, mark the Compare line endings (PC/Mac/Unix) checkbox. (To examine the line endings, mark View > Visible Whitespace 
.)
See also
