BizTalk server 2010 allow us to define 4 Types of schemas.
the most commonly used schema type in BizTalk. Inbound and outbound messages are type of schema. It is a document used to describe the element of real time business entity. The structure of XML is defined in XSD i.e. XML schema definition format. You can define XSD in BizTalk xml editor or you can regenerate it from given xml files. Because XSD is common standard then XSD can be created any XML Editor ie. Notepad ++, dreamweaver.
Flat file Schema:
The Schema base on Flat files. Most application still used comma separated, space separated or position based flat files. Flat File schema is right option to generate inbound and outbound messages. Flat files are beyond to capabilities of XSD. BizTalk Server Flat file schema defines a rich set of specific annotation tags that can be used to store all of the required additional information.
This schema format is used to translate all content and properties of flat file message instance into equaling XML message Instance and vice versa. Flat file Schema can also be used in BizTalk Mapper to transform incoming flat file message to different xml schema message or other flat file schema message.
Envelope schema is special type of schema. Messages of Envelope type wraps different xml business document into a single xml document. Envelope schema is used to define with common XML Schema. After xml schema is defined, many properties need to be set to convert xml schema into envelope schema. Most important of property is “IsEnveloped” property of XML Schema to Yes.
Property schema is used to store the promoted properties of BizTalk message. Property promotion is the process of copying specific values form within an instance messages to message context. Form message context these values easily accessible to BizTalk components. These components use the values to perform message routing. These values easily available in BizTalk orchestration and can be alter with respect to message. Property schema is simple xml schema that BizTalk used to copy promoted values of xml schema between xml instance messages and the message context.