What's the best practice of inserting a collection of data into a SQL Server database
You don't want either of those two options, though #2 is quite close. Option #1 is slow due to being row-by-row and each call being its own separate transaction. Even if you wrap all of the Stored Procedure calls into a single explicit Transaction, it will still be slower than a set-based approach.

Option #2 is flawed mainly for the additional work being done in both layers: joining the collection into a single string in the app layer, and splitting the string back out into elements in the data layer. However, the general structure of this idea &mdash; passing in just two params: ID and the collection of strings &mdash; is the way to go. You just need to use a Table-Valued Parameter (TVP) so that you can iterate through the collection as is, and receive it as a pre-populated Table Variable in SQL Server.

You do this by creating a User-Defined Table Type (which here could be a single NVARCHAR column) and using that as the parameter for the collection (hence the "Table"-Valued "Parameter").

The other piece to this puzzle is, on the app code side, creating a method that accepts int ID, List&lt;String&gt; _listobj and returns IEnumerable&lt;SqlDataRecord&gt;, and then use that method as the "Value" for the SqlParameter that is mapped to the TVP. Meaning, something like:

private static IEnumerable&lt;SqlDataRecord&gt; SendRows(List&lt;String&gt; RowData)
{
   SqlMetaData[] _TvpSchema = new SqlMetaData[] {
      new SqlMetaData("SomeSomething", SqlDbType.NVarChar, 4000)
   };
   SqlDataRecord _DataRecord = new SqlDataRecord(_TvpSchema);

   foreach (string _CurrentRow in RowData)
   {
      _DataRecord.SetString(0, _CurrentRow);

      yield return _DataRecord;
   }
}


Then, you would just pass in SendRows(_listobj) as the value for the TVP parameter. When you execute the SqlCommand, it will call that method and stream that collection into SQL Server.

The technique shown above requires no additional memory or processing, it just sends the collection as a collection. No need for DataTables or String.Joining or splitting :-).

To see a complete example code setup for this, please see my answer to the following Stack Overflow question: Pass Dictionary to Stored Procedure T-SQL.