Many wonder what the difference is between Search Engine Marketing and Search Engine Optimization. The short answer is SEO is a method used in SEM. SEM also uses Adwords, which is paid search results, where SEO does not, because SEO infact produces search results organicaly. Adwords pays a search engine for its possition in seach results or shows up in a section of the search engine dedicated to paid of rankings. SEO gets its rankings based on the contex with in a web page. SEO providers can determine what words are the best to used based on what keywords are being searched for the most.
Search Engine Marketing can include both Adwords and Search Engine Optimization, but in some schools SEM refers to pay per click advertising.
One other aspect of Search Engine Marketing is Social Media Marketing. And its importance is ever increasing with the growing popularity of social media networks. And it's popularity shows no signs of slowing.
So in conclution SEO (Search Engine Marketing) is a techneque used within SEM (Search Engine Marketing).