Please suggest a HD camcorder (Sony or Canon) with good sound recording quality. Budget is 500$.?

for a good camera I would always suggest a canon , however sound is a whole new kettle of fish , the sony is always the best option , unless you plan to use a zoom h4n or h2 mic , which is separate from the camera , there are sony options for under $500 but they are mini dvd , which i would steer you away from , keep looking , maybe raise the budget to $700 just to have extra choices and possible hdd camera's

You aren't going to get good sound quality out of ANY camcorder you buy. Sorry but unless you fork over $1000+, no camcorder is going to give you what you want. My suggestion? Get a camcorder with a mic input. Then buy an external mic, you could get one of the ones already posted like the H4n or the H2, but it all depends on what you are looking for in a mic. What do you want the mic for? Filming interviews? Home movies? Anyway my point is, buy a camcorder with a mic input and get a decent video mic. Got any more questions? Feel free to ask. Have a wonderful day.