Visual Studio Tools for Office
Visual Studio Tools for Office (VSTO) is a set of development tools available in the form of a Visual Studio add-in (project templates) and a runtime that allows Microsoft Office 2003 and later versions of Office applications to host the .NET Framework Common Language Runtime (CLR) to expose their functionality via the .NET type system.
This allows extensions to the Office applications to be written in CLI compliant languages as well as to use functionality and user interface constructs from Office applications in .NET applications. Extensions to Office prior to Office 2003 only allowed the creation of COM add-ins using Visual Basic or Visual C++ and a "Developer" edition was also offered that enabled VBA developers to create COM Add-ins.
VSTO supersedes developer editions of Office 2000 and Office XP for Office development. The developer editions of Office have been discontinued after Office XP and VSTO is available for Office 2003 and later versions only. The VSTO runtime, although part of VSTO development tools, is also downloadable separately if required. COM addin development is still possible for Office 2000 and all later versions using the Shared Add-in template in any version of Microsoft Visual Studio.
The VSTO add-ins (project types and controls) are also developed using Visual Studio. For Visual Studio .NET 2003 and Visual Studio 2005, it was available only as a standalone edition with support for .NET languages limited to Visual Basic.NET and C#. It was also included as a part of the Visual Studio Team System 2005.
Later on, the Visual Studio Tools for Office 2005 Second Edition (VSTO 2005 SE) was released as a free add-in to Visual Studio Professional and above that includes Office 2007 and 2003 support. However, for Visual Studio Professional Edition, it installs only the application-level add-ins; it does not add the document-level customizations or other functionality (actions pane, host controls, visual document designer, etc.) available in the full version of VSTO or Team System editions.
The current versions is Visual Studio Tools for Office 2010 (VSTO 4.0) which is compatible for both Office 2010 and Office 2007.
Comparison with VBA 
Like VBA, code written for VSTO is executed by a separate virtual machine (the CLR) which is hosted inside the Microsoft Office applications. However, unlike VBA, where the code is stored in the document file itself, programs written with VSTO are stored in separate CLI assemblies which are associated with the documents by means of custom properties.
If the properties are present, Microsoft Office hosts the CLR and loads the assembly specified in the property into a separate appdomain named after the document's name. VSTO applications are subject to the .NET Framework Code Access Security constraints, in addition to the digital signature based permission model that governs VBA macros.
VSTO development is normally performed using Visual Studio as used by professional programmers. The office application is (re)started for each debugging session. VBA is normally developed from within the Office application and requires no special tools. VBA also has a macro recorder that can generate VBA code from user actions which is useful for non-professional programmers.
VSTO compatibility and add-in functionality 
VSTO 2003, 2005, 3.0 and 2010 runtimes install in side-by-side (SxS) mode. VSTO 2005 SE runtime replaces the earlier VSTO 2005 runtime. VSTO 2010 runtime installs side-by-side with VSTO 3.0, however, Office 2007 applications can also use the VSTO 2010 runtime. All older VSTO solutions will continue to run in newer versions of Office as long as the runtime against which they were developed is installed.
VSTO solutions developed against newer Office versions will not work in older Office versions as they lack the necessary Primary Interop Assemblies (PIAs)  Office 2010 applications will always use VSTO 2010 Runtime. Design-time support is as follows:
|VSTO/VSTO runtime version||Develop/Build against Office 2003||Develop/Build against Office 2007||Develop/Build against Office 2010||.NET version||Available as|
|VSTO 2003||Word, Excel||—||—||—||—||—||.NET 1.1||Available only as Visual Studio .NET 2003 VSTO SKU|
|VSTO 2005||Word, Excel||Outlook||—||—||—||—||.NET 2.0, 3.0 or 3.5||Available as Visual Studio 2005 VSTO SKU and part of Visual Studio 2005 Team System editions|
|VSTO 2005 SE||Requires VSTO 2005 for document-level customizations||Word, Excel, Outlook, PowerPoint, Visio||InfoPath||Word, Excel, Outlook, PowerPoint, Visio, InfoPath||—||—||.NET 2.0, 3.0 or 3.5||Downloadable for Visual Studio 2005 Professional and above, however document-level customizations require original VSTO 2005 (Standalone SKU or Team System editions)|
|VSTO 3.0||Word, Excel (Builds against the VSTO 2005/2005 SE runtime)||Word, Excel, Outlook, PowerPoint, Visio, Project (Builds against the VSTO 2005 SE runtime)||Word, Excel, InfoPath||Word, Excel, Outlook, PowerPoint, Visio, InfoPath, Project, SharePoint 2007 Workflows||—||—||.NET 3.5||Built into Visual Studio 2008 Professional and above|
|VSTO 4.0||—||—||Word, Excel||Word, Excel, Outlook, PowerPoint, Visio, InfoPath, Project||Word, Excel||Word, Excel, Outlook, PowerPoint, Visio, InfoPath, Project||.NET 3.5 or 4.0||Built into Visual Studio 2010 Professional and above|
Code developed with various editions of VSTO will only work with certain releases and editions of Microsoft Office 2003 and related products. Specifically, VSTO solutions developed in editions prior to VSTO 2005 SE will not work with any edition of Office 2003 other than Professional. VSTO solutions developed with VSTO 2005 SE will work with Office 2003 Standard (only application-level add-ins) and Professional. VSTO 2005 SE solutions will work with all editions of Office 2007.
See also 
- Visual Studio Tools for Office
- Visual Studio 2005 Tools for the 2007 Office System (VSTO 2005 SE) Released to the Web
- VSTO features available by product combination
- More on Word and Excel as CLR hosts
- Another CLR hosts are shipped from Microsoft
- VSTO Security Model
- VSTO Loader and Runtime Components
- Visual Studio Tools for Office homepage
- VSTO 2.0 SE (VS 2005) Add-in (Office 2003 and Office 2007)
- VSTO 2.0 SE (VS 2005) Runtime for Office 2003 and Office 2007
- VSTO 3.0 (VS 2008) Runtime for Office 2007
- VSTO 4.0 (VS 2010) Runtime for Office 2007/2010/2013 (permalink)
- Jake Ginnivan: Adding Value to Software projects with VSTO