Storage:
1) Arrays are statically allocated whereas linked list are dynamically allocated and linked.
Generally, if the number of allocations are known before hand, we use arrays. Otherwise linked list
Performance:
2) Array is a high performance way of storing a group of data because each element is laid out next to it's neighbor in memory. This allows for very fast access because (a) the code can do a little math and jump quickly to any location in the array, and (b) the elements are all grouped together so they tend to be in memory at the same time (fewer page faults and cache misses).
3) If you want to index by something like a string, you could use a hash table. Lets say you have a list of players, and you want to pull an object up from each player's name. You take the string, run a hash function to convert that into a number that falls within the range of an array, and store it in that element.
Or, you can have a linked list faster by breaking it into subelements. For example, if you were storing words in a dictionary, you could have an array of linked lists with 26 entries for a-z. That way when you manipulate a list, you are manipulating a much smaller subset.
Side note:
1) Java provides arraylist (java.util.ArrayList) option to programmers. So whether ArrayList better than array ?
If the data has a known number of elements or small fixed size upper bound, or where efficiency in using primitive types is important, arrays are often the best choice. However, many data storage problems are not that simple, and ArrayList (or one of the other Collections classes) might be the right choice.
2) How Arraylist are created ?
ArrayLists are implemented with an underlying array, and when that array is full and an additional element is added, a new, larger, array is allocated and the elements are copied from the old to the new. Because it takes time to create a bigger array and copy the elements from the old array to the new array, it is a slightly faster to create an ArrayList with a size that it will commonly be when full. Of course, if you knew the final size, you could simply use an array. However, for non-critical sections of code programmers typically don't specify an initial size.