The major difference between a cloud and on-premises
application is that the Azure application won’t run locally. To help mitigate
this, MS introduced the concept of development fabric, a version of Windows
Azure environment that runs on the developer’s system.

Development fabric consists of the Azure storages and all
roles like Web, Worker and VM. A developer can build, deploy and test a Azure
application locally without connecting to Azure data centers.

After development and test completes, the application will
be moved to the   staging environment using Windows Azure portal.
In staging the application receive a temporary URL [GUID].cloudapp.net. Once it
moved from staging to production, it will be replaced with the actual DNS name.