What is the difference between stegenography and watermarking?

Answer 1

Stegenography is the act of adding a hidden message to an image or other media file. It is similar to encrypting a document, but instead of running it through a cypher, the document is broken up and stored in unused, or unnoticable, bits within the overall image.

Watermarking is similar, but has a completely different purpose. Placing a watermark in an image or other media file serves to identify the artist or author of the work. It isn't so much an attempt to hide a message as it is to tag a document for later identification. Watermarking is used to protect the copyright of the original owner, to make their claim stronger, should the image be used without permission by someone else.