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A package unit contains all elements of the refrigeration cycle in one system. The 4 major components include: A compressor, condenser, metering device, and a evaporator. All elements are needed to complete the cycle of refrigeration.
As for a split unit, All elements of the refrigeration cycle are used, however the condenser is located outside of the facility, while the evaporator is located inside of the facility.
To better understand the difference in question, you must understand the job of each component in the refrigeration cycle. For example, a condenser is normally used to reject heat or cold air from a building, while a evaporator normally supplies heat or cold air to the building.
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