Question: Are there disadvantages of using XML, instead of RDMS? The reason I ask this is because my data is more naturally represented by XML structure, rather than RDBMS. I initially thought of [storing the data in relational database](https://stackoverflow.com/questions/545145/map-xml-structure-to-database-schema), but the lack of flexibility of relational database to handle tree-like data structure was putting me of. So I am thinking about just storing the data in XML.

One thing I fear is performance penalty. While RDBMS can handle large datasets, I am not sure whether the same can be said about XML. Also, the database queries are pretty well-established and fairly easy to use and construct, what about XML queries? I don't know.

I am doing .Net application.

Answer: 
In my opinion, these are the factors to consider

1. Which fits your applications needs more closely
2. How large a data set you need to handle?
3. Are you transferring data between applications or are you going to query it?

Once these factors are considered, I would suggest that you decide to use RDBMS, if you have large data processing and querying needs and XML if you need to export data or transfer it between applications. i would also like to suggest that you consider constraints on your data and integrity needs like Nick has suggested.

I have little experience in the area, however this is what I have heard from others at my school.

All the best.
You can have the best of both worlds, your data can be stored in the database, and that has to be a better solution. As a DB is faster, more secure, has backup and restore, rollback, admin tools and so on .... 

It sounds as though your data is hierachial in nature, databases can be coerced to store hierarchies without too many issues.

When it comes to using your data if you extract it as Xml. I know if you're using Sql Server that works out of the box, not so sure for Oracle.