DIFF utility works for 2 files. How to compare more than 2 files at a time?

Checkout "Beyond Compare": http://www.scootersoftware.com/

It lets you compare entire directories of files, and it looks like it runs on Linux too.

diff has built-in option --from-file and --to-file, which compares one operand to all others.

   --from-file=FILE1
          Compare FILE1 to all operands.  FILE1 can be a directory.

   --to-file=FILE2
          Compare all operands to FILE2.  FILE2 can be a directory.

Note: argument name --to-file is optional. e.g.

# this will compare foo with bar, then foo with baz .html files
$ diff  --from-file foo.html bar.html baz.html

# this will compare src/base-main.js with all .js files in git repo,
# that has 'main' in their filename or path
$ git ls-files :/*main*.js | xargs diff -u --from-file src/base-main.js

Displaying 10 files side-by-side and highlighting differences can be easily done with Diffuse. Simply specify all files on the command line like this:

diffuse 1.txt 2.txt 3.txt 4.txt 5.txt 6.txt 7.txt 8.txt 9.txt 10.txt

Vim can already do this:

vim -d file1 file2 file3

But you're normally limited to 4 files. You can change that by modifying a single line in Vim's source, however. The constant DB_COUNT defines the maximum number of diffed files, and it's defined towards the top of diff.c in versions 6.x and earlier, or about two thirds of the way down structs.h in versions 7.0 and up.