Excel Online is a browser-based version of Microsoft Excel, the ubiquitous spreadsheet app you've likely been using for years. Excel Online is a "lite" version of the full-fledged desktop app and provides fast opening times for reading and editing .xlsx and .xls files. Excel Online is great for reading Excel files and making simple edits from basically any browser on almost any device.
Most Excel files will open directly in Excel Online when using SharePoint Online, OneDrive for Business, MS Teams, Yammer, and some other Office 365 apps. Files open in reading mode. To edit the files, simply click the "Edit Workbook" button and choose to edit the file in Excel Online (directly in the browser) or Excel (the desktop app).
Functionality in Excel Online is generally limited to day-to-day editing, text entry, simple functions, hyperlinks, some formatting, comments, displaying charts, and simple pivot table functionality, though it provides good support for co-authoring (simultaneous editing by multiple users). All changes made in Excel Online are saved automatically; there is no save button.
You'll want to avoid more complex tasks like image manipulation, data connections between files, creating pivot tables, creating charts, and using more complex functions (among others) in Excel Online. Macros will not run in Excel Online and protected spreadsheets will not open in Excel Online.
If Excel Online doesn't provide the features you need to do the job, simply click the "Edit in Excel" button in the menu bar to access the desktop version of the app and its more complex features. Some versions of the desktop app save updates automatically, but some do not. Be aware of how this feature works on your version.
- Matt Wade, Office Services MVP