WinMerge is Open Source, works for both files and flders and allows even comparing three files/folders.

I use winmerge a lot for reviewing the code changes in the large files. Winmerge has a support for upto 3 concurrent window viewing at the same time. We can also use different format of input files to view, modify the code. It is really useful for those who primarily works on the large text files to track the changes.

What I like best about WinMerge is that it provides the perfect set of features for my use case. I very often use the tool to view diffs between files of structured data such as XML or JSON, and it's moved block detection, highlighting of changes, and being able to ignore whitespace differences lets me visualize the important differences between two files. I like that it lets me do diffs on files, but also do diffs on any text I paste into the tool on the fly. But best of all is the price, as it is an open-source free-to-use diff and merge tool for Windows.