Unlock - Add the ability to use the phone on another network. Phone providers can unlock legally for you, but you usually need to have had the phone or contract for a certain period & possibly pay a fee. Unlocked phones are still 100% legit in Apple's eyes for warranty & support etc. Jailbreak - Gain access to the software to allow you to do what you want to it. eg Install apps that Apple doesn't sell in the store or modify features that iOS doesn't support.