Diffusion refers to the movement of molecules or atoms from an area of high concentration to an area of low concentration, down a concentration gradient. It first clicked for me when I thought about it in terms of people getting onto a bus. Imagining that people are molecules, when we get to a station lots of people get onto the bus at the door at the end of the carriage. These people represent our molecules. Suddenly there is a high concentration of people/molecules at one end of the bus making them very squashed. In order to get more space, some people move to the empty end of the bus (the lower concentrated end). This little shifting about keeps happening, until the spread of people throughout the bus is roughly equal at both ends. This is exactly the same as the movement of molecules - they continue to spread out into areas of more space, untill they are roughly equally spaced across the volume they are within. Osmosis refers to the movement of water molecules from an area of high water potential, to an area of low water potential, across a partially permeable membrane. A partially permeable membrane is a membrane which lets some things through, eg. water molecules, but blocks other big objects or molecules eg. salts. This time instead of all the molecules moving to equilibrium (where there is equal concnetrations on either side of the membrane), we want to see the water molecules move to create an equal water potential. This means if we have 2 solutions separated by a partially permeable membrane - one solution salty, and one of pure water; we will see a movement of water to the more salty side, in turn diluting it until the water potentials on either side of the membrane are the same.