This report provides a comparative analysis of the Waterfall model and Extreme Programming (XP), two prominent software development methodologies. The first part of the report outlines the problems associated with the Waterfall model, including its sequential nature, inflexibility to requirement changes, difficulty in measuring progress, and challenges in risk assessment. It also discusses why organizations continue to use the Waterfall model, highlighting its ease of understanding and focus on goals. The second part delves into Extreme Programming, detailing its origins, key stages (planning, design, coding, and testing), and core principles. It emphasizes XP's agile approach, addressing the Waterfall model's inflexibility to changes. The report highlights the differences between the two models and concludes by addressing the disadvantages of XP, such as requirement volatility and the informality of requirements. The report references a research paper and a software engineering textbook to support the analysis and provide a comprehensive overview of the two methodologies.