A link farm is like a farm house of links where any link can stay without any relevant category requirement but have to follow rules and guidelines of that link farm, in other words we can say as a link farm is simple collection of links with no set of categories under which the links are placed. Anyone and everyone can submit their links and there is little or no editorial review of these links. In fundamental nature, these links have been built for the one and only purpose of manipulating the search engines and not designed for the end user. One can identify a link farm from its link pages, where there are hundreds of links on one page and all of them linking to out sites of various topics. There is basically no meaningful purpose or meaning behind the links on the page.
As you know better that web directories are home of links because it has huge collection of links under relevant categories, and that’s why web directories is very reliable to find any link related to particular category, in other word we can say that a web directory is not only a collection of links but the links have been categorized under relevant categories and sites are listed only after they undertake editorial review. Directories are helpful to the user in that if a user wanted to find a site under a particular category, it would be easy to go to the suitable category and decide from the selection of links. All links in a web directory are well-categorized and importantly sorted out. Not every link that is submitted to a directory will necessarily is listed as there is all the time some kind of management over the links allowed in a directory.
Now you can take decision yourself that what is important for your site link and for your site ranking, link farm or web directory. Link farm is only and only useful for quickly listed in search engine because it take less time than web directory in other word we can say that having a link on a link farm would not be counted for much, if at all; by the search engines while having a link on a web directory would definitely count for more value. It’s advisable to avoid having links on the so-called “FFA” or “Free For All” Links pages or any pages where there seems to be no order and flow in the way the links are displayed.
Avoid submission in Link farm because generally these type of links are not counted by search engine, may be these links hurt your ranking. Submit your link to Seo-friendly directories for Link popularity and Link Building.