Honestly, I didn't know the difference myself until I read about it on the internet.

Claus Schwarm puts it this way in a thread at answers.startup.com :

Marketing is often confused with promotion.

There are basically two definitions of marketing:
In the "pragmatic" definition, marketing is a management activity covering fields related to revenue. This is typically summarized by the 4 P's: Price, Place (ie. distribution), Promotion, and Product.

As a management activity, marketing involves the steps that usually include measuring the 'Is' situation and the 'Ought' situation, constructing a plan to get from 'Is' to 'Ought' and controlling the effectiveness of the plan. Rinse, repeat.

Selling is a process to get leads sign a contract and becomes customers. Typically, this includes understanding the prospect's problems, presenting a way how the product solves these problems, deal with any objection a prospect mentions, and finally get the prospect to sign the contract.

So, they both deal with similar problems, but from different points of view: Marketing looks at the aggregate result. Sales often look at the individual results. Consequently, they may have different goals.

Whether they differ, depends on your distribution policy:

• With direct marketing such as sales letters or web pages, you typically do not have direct contact with a lead. Then, marketing needs to adopt many sales techniques in the promotion policy. Thus, there's seldom any conflict between marketing and sales and it's not a problem to have one person do both.
  
  
• With direct selling, a sales man has direct contact with a lead. Here, the goals of sales men may conflict with marketing goals, since sales man often like to deviate from marketing policies to close the deal. This includes lowering the price, adding free give-aways, etc. In a small startup, however, most marketing is done by the team, with the sales guy only does some additional promotion. As long as you have an eye on the general direction, there should be no serious problems in the beginning.
  
  
• With intermediate selling, someone outside the company has direct contact to the prospect (retailers, affiliates, etc). They, too, may have an incentive to violate marketing policies (lowering the price, presenting your luxury brand alongside common brands, etc.). You often need to emphasize promotion to customers and a strict distribution policy to prevent such problems.

Your distribution policy finally depends on the product. Some need personal sales men, some do not. If you need separate sales men, it's often advised for marketing people to do sales from time to time, just to keep contact with the customers' wants and needs.

Sales is the advocate for the company. They are primarily focused on selling the companies products and services. The needs of the customer is secondary to this function.

Marketing is the advocate for the customer. They figure out the customer pain (e.g. needs) and try to fill them profitability with products. All other aspects of marketing (promotion, pricing and place) are all about telling the customer that the company can fill their need.