Active Shutter technologies work by displaying the left image for less than 1/60^th of a second and then displaying the right image for a similarly short period of time.  The active glasses are synchronized to the display and the lens for each eye is transparent for a corresponding time.  An infrared (or Bluetooth)  signal from the display controls the glasses.  The glasses for this approach are complex and require batteries (either replicable or rechargeable) and usually cost somewhere around $150 each.

Passive systems for LCDs depend on a polarizing filter (called a Film Pattern Retarder, or FPR) over the TV screen.  These have circularly polarized horizontal stripes which have one polarization for the left eye and the opposite for the right eye.  Alignment of these stripes to the display lines is critical.  

Because one stripe is dedicated to the left eye, and the other to the right eye, the vertical resolution to each eye is limited to 540p on a 1080p set.  This is even worse on side by side 3D "broadcasts" where the resolution is reduced to 1/4 of normal HD (960x540 pixels vs 1920x1080).  However, when viewing 2D (without glasses), the display will show the  normal 1080p resolution.  The passive glasses are relatively simple because they just have polarized filters and cost around $10 (or less) each.

Generally, the passive approach adds cost to the set (the filter is costly) but uses relatively cheap glasses.  On the other hand, the Active Shutter approach adds little cost to the set, but the big cost adder is in the glasses.

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Which is “better”: Active or Passive?
Naturally, each manufacturer's marketing department tries to convince us that their approach is the best and that the other approach has significant problems.  The following chart summarizes these claims.  Passive 3D displays are new, but reviews are starting to appear.  CNet was the first to publish a comparison between a 65" Panasonic plasma (active) and a 65" Vizio LED/LCD (passive).  More recently, Consumer Reports has published a similar comparison.  These comparisons refutes some of the passive claims.  On the other hand, Dr. Raymond Soneira, of DisplayMate Technologies, has posted an exhaustive study comparing these two technologies that supports the passive claims.  

Active:

Pros:

• Usually* has higher resolution (1080p vs 540p for direct view sets).

Cons:

• More prone to “ghosting” (particularly on LCD sets).
• Some viewers are affected by "flicker" (many be visable or may cause headaches)
• Glasses are expensive.
• Glasses supplied with one brand of set usually can’t be used with another brand.
• Glasses require batteries (need to be replaced or re-charged).
• Glasses are bulky.
• Where IR is used (most cases), there can be issues with losing "sight" of the IR signal and the 3D dropping out.

Passive:

Pros:

• Lower cost glasses.
• Less ghosting than active shutter.
• Absence of "flicker".
• Image at the eye is brighter.

Cons:

• It is more expensive to manufactuer the screen.
• 2D images are dimmer as filter reduces brightness (not really an issue for LCD sets as the backlight can just be cranked up higher).
• Visible video artifacts, such as jaggies and moiré, in some scenes.
• Very fine details that fall within a row of pixels tend to "shimmer" since each eye is only getting half the image.
• It is claimed that the filter used over the screen further reduces the horizontal viewing angle (LCDs already reduce viewing angle).  It is also claimed that the vertical viewing angle is severely reduced (might be a problem where the display is mounted high on a wall).

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*Note:  This resolution reduction is with the current 1080p panels.  LG has demonstrated an ultra resolution 84” LCD 3D panel that has a native resolution of 3840X2160.  So half of that resolution yields 1080 (x 3480) resolution (or "Full 3D HD").  No plans for production (or price!) have been announced.

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