ran across this article when looking up the difference between Devils and demons after a discussion...
A large portion of the population of the United States would declare itself Christian, if given a questionairre with boxes to fill out. However, despite this loyalty to Christianity there is a remarkable lack of attention to detail and to the study of the Bible that lays out the basis for the religion. For instance, most people are unaware that nowhere in the Bible is there a description of hell. That was provided by the poet Dante. Ditto our description of the devil, which has been elaborated on by various writers of fiction and the opinions of biblical scholars. All we know for certain is that he's charming, charismatic, a tempter who is evil and against God. Not much to go on. Often these oversights boil down to a lack of explanation and historical context, combined with translations from one language to another and needing to translate ideas in meaningful ways. This is where the difference between devils and demons comes from.
Most people, if asked, would just tell you that a devil and a demon are the same thing. They're both evil spirits that do bad things on the command of Satan. Some people might even get cute and tell you that Satan is the devil, and that demons are those that follow his orders. While this is close, the devil's really in the details. To see the true difference between them, you need to look at the language that evolved into these terms, and to understand the biblical reasoning behind them.
Let's begin at the beginning. Angels, in all their shapes and sizes, have a hierarchy. At the top are the archangels, or archangel in the case for those who believe it is just the archangel Michael who holds that spot. Archangels, and proper angels who were created by God, can change their appearance and exist either in the realm of spirit or in the realm of Earth, making themselves physical bodies. The argument is that devils are cast out angels, who also have the level of power given by God to his creations, and these beings likewise have physical forms that can be altered and manipulated as desired.
Moving on to the word demon. The word demon, which is used for a number of different religions in translation, comes from the Old Greek daio, which means "to separate." This term referred to beings in the pagan myths who were higher than men, but lower than the gods. The word eventually morphed into the more familiar daemon or daemones, which then changes to demons. So from this we can construe that demons are less powerful than devils, and if we look a bit closer, we can also guess that they're formed from the breeding of the divine with the mortal.
There is a phrase in Genesis that refers to the sons of God coming to the daughters of Man. Without out and out saying it, it's referring to the breeding of angels (or devils in this case, since it's assumed the act is below angels still in heaven) with mortals to form "giants." Examples of this sort of breeding can be seen in a variety of forms, such as Lilith breeding with mortals and with spirits to create her offspring. Succubi and incubi are creatures of spirit that come to sleeping mortals and have sex with them; with the succubus creating evil spirits and the incubus impregnating women to create half breed children called cambions. An old Celtic myth claims that Merlin might have been a cambion.
In the bible, this race of giants was referred to as the Nephilim. While once great and powerful beings who had flesh and spirit of both parents, their bodies were destroyed by the flood (or so the book says). Powerful even without bodies, these beings became demons and were creatures of pure spirit who had no bodies. Much like the djinn and the ghouls in Islam, demons are creatures who are evil spirits, seeking to influence but not as powerful as the purer and stronger devils who are their progenitors.
It's for this reason that you only hear about demonic possession, but never devilish possession. Men may cast out demons, and rebuke them in the name of God, but devils are stronger and older, more powerful than anything but beings of an equal, divine weight class. It's for these reasons that while demons might possess people, the devil always shows up in person.