Question: What is internal and external sort?
Answer: Internal sort - your program calls sort. If you look at your program source code you will see that the procedure division contains a single sort statement and the rest of the program is called from exits defined in that statement.
External sort - the job runs a sort step. That sort step may call an E15 and/or E35 exit to run a sub-program against the data records either before or after they are sorted.
This article written by Stephen Chapman, Felgall Pty Ltd.