Response.Redirect vs Server.Transfer

Response.Redirect:

It is more user-friendly, as the site visitor can bookmark the page that they are redirected to.

Transferred pages appear to the client as a different url than they really are. This means that things like relative links / image paths may not work if you transfer to a page from a different directory.

 
Server.Transfer :

It has an optional parameter to pass the form data to the new page.

Since the release version, this no longer works, because the Viewstate now has more security by default (The EnableViewStateMac defaults to true), so the new page isn’t able to access the form data. You can still access the values of the original page in the new page, by requesting the original handler: