Abstract The relationships between and relative advantages of finite difference and finite element methods are discussed. The less familiar finite element methods are described first for equilibrium problems: it is shown how quadratic elements on right triangles lead to natural generalisations of the powerful, fourth order accurate nine-point difference scheme for the Laplacian. For evolutionary problems, the recent development of more accurate difference methods is considered together with that of Galerkin methods. It is shown how conservation properties are best preserved by the latter methods and, in particular, how the supression of non-linear instabilities in the advection equation is achieved by the Arakawa schemes. Finally, an error analysis is described which is applicable to both finite difference and finite element methods.