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Magento offers two primary versions: Magento Open Source and Magento Commerce, which includes Magento Commerce Cloud and Magento Commerce On-Prem. Both versions are technically open source, although only one is explicitly labeled as such. This can create confusion, as the Open Source version is still a commerce engine despite lacking the 'Commerce' label. The key distinction is that Magento Open Source is free to download, allowing users to access the source code at no cost. Understanding these differences is crucial for newcomers navigating Magento's offerings and associated costs.