More specifically, Toronto has Lake Ontario to help moderate the temperature, and furthermore it's on the northern shore, the relevancy of which will become apparent in a moment.I remember a few years ago I was in WDW during the month of December when Buffalo got a major snow storm, however it did not hit Toronto. When I asked my Dad how is that possible, he said the same thing you mentioned about how Toronto has Lake Ontario to moderatre the temperature.
Buffalo is on the eastern shore of Lake Erie. Why does that matter? Because Lake Erie is (compared to the other great lakes) quite shallow. There isn't nearly as much actual water in there to help moderate temperatures. So little, in fact, that it freezes over by mid-January most years. When the top of the lake is frozen, it's more like a giant flat piece of land, and it no longer has the same moderating effect on temps.
Lake Ontario, on the other hand, is very deep by comparison. Some ice forms on it near the shorelines where it's shallower, but the majority of the lake never freezes over in the winter time. That makes a big difference.
As far as snowfall goes, Buffalo tends to get hit really hard early in the season. This is because the prevailing weather patterns move from west to east. When a cold air mass moves over Lake Erie from west to east, it picks up a lot of moisture off of the (not yet frozen) lake and dumps it on Buffalo. A few years ago Buffalo got over 7 feet of snow in the course of two days because of this -- right around Christmas time. Once Lake Erie froze later in the season, Buffalo got far less snow, but of course those cold air masses still moved in making it pretty cold.
Toronto is on the north shore of Ontario, and so doesn't get anywhere near as much snow. Cold air masses move east over Lake Ontario and pick up moisture, but since Toronto is north of the lake most of that moisture ends up falling to the south and west of it. Basically, over upstate NY, where I live.

Again, sorry for the sidetrack. Somebody post a funny Disney story!
David