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string is an alias in C# for System.String.
So technically, there is no difference. It's like int vs. System.Int32.

As far as guidelines, it's generally recommended to use string any time you're referring to an object.

e.g.

string place = "world";

Likewise, I think it's generally recommended to use String if you need to refer specifically to the class.

e.g.

string greet = String.Format("Hello {0}!", place);

This is the style that Microsoft tends to use in their examples.

It appears that the guidance in this area may have changed, as StyleCop now enforces the use of the C# specific aliases.

• None: The file is not included in the project output group and is not compiled in the build process. An example is a text file that contains documentation, such as a Readme file.

• Compile: The file is compiled into the build output. This setting is used for code files.

• Content: Allows you to retrieve a file (in the same directory as the assembly) as a stream via Application.GetContentStream(URI). For this method to work, it needs a AssemblyAssociatedContentFile custom attribute which Visual Studio graciously adds when you mark a file as "Content"

• Embedded resource: Embeds the file in an exclusive assembly manifest resource.

• Resource (WPF only): Embeds the file in a shared (by all files in the assembly with similar setting) assembly manifest resource named AppName.g.resources.

• Page (WPF only): Used to compile a xaml file into baml. The baml is then embedded with the same technique as Resource (i.e. available as `AppName.g.resources)

• ApplicationDefinition (WPF only): Mark the XAML/class file that defines your application. You specify the code-behind with the x:Class="Namespace.ClassName" and set the startup form/page with StartupUri="Window1.xaml"

• SplashScreen (WPF only): An image that is marked as SplashScreen is shown automatically when an WPF application loads, and then fades

• DesignData: Compiles XAML viewmodels so that usercontrols can be previewed with sample data in Visual Studio (uses mock types)

• DesignDataWithDesignTimeCreatableTypes: Compiles XAML viewmodels so that usercontrols can be previewed with sample data in Visual Studio (uses actual types)

• EntityDeploy: (Entity Framework): used to deploy the Entity Framework artifacts

• CodeAnalysisDictionary: An XML file containing custom word dictionary for spelling rules