Sed is
a noninteractive, or stream-oriented, editor.
It interprets a script and performs the actions in the script.
sed is stream-oriented because, like many Unix programs,
input flows through the program and is directed to standard
output.
For example, sort is stream-oriented; vi is not. sed's input typically comes from a file or pipe but can be directed from the keyboard. Output goes to the screen by default but can be captured in a file or sent through a pipe instead.
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Awk
is a programming language whose basic operation
is to search a set of files for patterns, and to
perform specified actions upon lines or fields of lines
which contain instances of those patterns.
The basic operation of awk is to scan a set of input lines in order, searching for lines which match any of a set of patterns which the user has specified. For each pattern, an action can be specified; this action will be performed on each line that matches the pattern.
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