Opera

To slightly alter what Western ballerina said: musical theater is a story with songs thrown in, where as an opera is a song with a story thrown in. I am a musical theater nerd at an opera nerd school (one of the reasons I am transferring lol). the type of voice used in opera is a very more trained voice. you don't have to have as much vocal training to be in musical theater.

To tell you the truth I know people in MT that have gone very far with little to no training, but any opera performer has years and years of training. For the most part if you can sing opera you can sing at MT (there are always exceptions so that is not always true) but you can't necessarily be an opera singer with only a MT background. hope this helped.

AddendumWhere a musical contains spoken dialogue, opera dialogue is always (almost) sung. Additionally, to add to the foregoing answer (and to risk offending some opera buffs), acting is perhaps a more important element in a musical where much of the "acting" in an opera is a function of communicating with the voice.

The musical can be looked upon as a further evolution of opera, operetta etc.

Opera [Opera = work]. Opera is a drama to be sung with instrumental accompaniment usually with scenery and in costume. It may include recitative or spoken dialogue, but the essence of opera is that the music is integral and is not incidental as in a 'musical' or play with music.

Musical [theatre] is a form of theater combining music, songs, spoken dialogue. Usually the play [musical] is interrupted by songs or such like.

So basically 'opera' is music drama and 'musical' is a play [drama] with music interludes.

But like all thing to do with music there are variants.

Correction to Addendum

There are several musicals that have no spoken dialogue (e.g., Les Miserables, Phantom of the Opera and Evita).