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Program arguments are arguments that are passed to your application, which are accessible via the "args" String array parameter of your main method. VM arguments are arguments such as System properties that are passed to the Java interpreter.

java -DsysProp1=sp1 -DsysProp2=sp2 test.ArgsTest pro1 pro2 pro3

The VM arguments go after the call to your Java interpreter (ie, 'java') and before the Java class. Program arguments go after your Java class.