What is the main differences? Are they essentially the same thing? From what I have gathered, the two are fundalmentally the same. If a photon gives up all its energy after interaction with an electron than the photoelectric effect applies. On the other hand if the photon continues to travel and possess kinetic energy after collision with an electron than the Compton effect takes place. Also it seems the photoelectric effect happens mainly with electrons in metals whereas the Compton effect is with any material.