What is the difference between an Extension and a Module?

Question

What is the difference between an Extension and a Module?

Just curious to know that what is the right term to use when we extend Magento's functionality by creating our custom code in local folder.

Answer 1

Extensions are simply packed modules. In other words, you extend the features and functionality of Magento by writing a module. Then you have a choice to leave it as it is or pack it up (System > Magento Connect > Package Extensions). An extension (a packed module) is then published on magento connect

Answer 2

I wish everyone will make up their minds and use the same term.
Now we have extension, module, bundle, plugin and maybe others and it's getting silly.
Basically a module is an extension.
The only difference might be that what's in the core may not be considered extensions, but they are modules.
So Mage_Catalog is a module but not an extension.
Something_Else is a module and an extension because it's not in the core.

Answer 3

Module is the technical term for anything you define in app/etc/modules

Extension is the marketing term for published¹ community modules (or generally any code that extends Magento functionality and is not a theme)

Extensions usually consist of one or more modules. The ebizmarts MageMonkey extension for example comes with four actual modules that are bundled as one extension: Ebizmarts_AbandonedCart, Ebizmarts_Autoresponder, Ebizmarts_MageMonkey and Ebizmarts_Mandrill.

Themes also often come with theme specific modules that are not distributed separately and nobody would call them extensions.

---

^{1) be it via Magento Connect, Github or an extension store}