An operating system is the type of computer system you have such as Window XP or Window 95, 98, Macintoch, etc. Application software is the software that you install onto your operating system. These softwares can be obtained via a purchased CD from a software company or downloaded from a software companies web site.

The operating system (or OS) is the software that make the computer work. There are several different OS's out there. These include Windows, the Mac OS, and the various forms of Unix among others. The type of computer you have will largely determine the type of OS that you can install on it. Most Intel/AMD based PC's come with Windows installed. Macintoshes come with the Mac OS. Various forms of Unix have been written to run on both platforms and the most recent Macs (the Intel based ones) can also run Windows though you have to provide and install your own copy of it if you want to do this. The application software consists of the programs that actually let you do things with your computer. These applications are written to run under the various operating systems. These include things like your word processing programs, spread sheets, email clients, web browser, games, etc. A program that is written to run under Mac OS won't run under Windows and a program that is written for Windows won't run under Mac OS. However, many programs, such as most of the Microsoft Office suite of programs, are written in both Mac and Windows versions, but you still have to have the right version for your OS. So, the operating system of a computer is the software that allows the computer work. It provides the framework under which the applications run. The applications are the software that actually allows the user to do something with the computer. Without the applications, all you can do is change settings and navigate among the folders.

Some of my answer may seem to echo others but I'd word things just a little differently. An operating system (OS) is software that acts as an interface between you and the hardware. It not only contains drivers used to speak the hardware's language, but also offers you a very specific graphical user interface (GUI) to control the computer. An OS can also act as an interface (from the hardware) to the other software. A complex OS like Windows or Linux or Mac OS offers the services of an OS, but also has applications built in. Solitaire, Paint, Messenger, etc. are all applications. As others have said, an application is software that serves a specific function. It allows you to communicate, create and modify documents, play games, etc. The whole picture is much more complicated, I just wanted to offer the idea of the 'interface' to the explanation.

Application Software: is developed to help the user to increase his/her productivity. Operating System is provide an enviornmnet to utilize the resources of the computer like hard driver, ram, processor etc. Operating System is a translator between user and computer.