compare-windows-highlight is a variable defined in `compare-w.el'.
Its value is

Non-nil means compare-windows highlights the differences.
The value t removes highlighting immediately after invoking a command
other than `compare-windows'.
The value `persistent' leaves all highlighted differences. You can clear
out all highlighting later with the command `compare-windows-dehighlight'.

You can customize this variable.

This variable was introduced, or its default value was changed, in version 22.1 of Emacs.