1. Tangibility
2. Can You Grab It? The Physical vs. The Digital
This is perhaps the most obvious difference. Hardware is, well, hard. It's the stuff you can physically touch, like your keyboard, mouse, monitor, CPU, RAM, and that dust bunny lurking behind your computer. You can hold it, drop it (please don't!), and admire its shiny exterior. It occupies physical space and has a definite mass.
Software, on the flip side, is intangible. You can't physically touch Microsoft Word, your web browser, or that awesome photo editing app. It exists as a set of instructions and data, stored electronically. You can see it on your screen, interact with it, but you can't pick it up. It's more like a ghost in the machine — a benevolent one, hopefully.
Imagine trying to give someone "software" as a gift. You'd hand them a USB drive or a download code, not the software itself. The USB drive is the hardware carrier, and the download code allows access to the software bits. Big difference!
This tangibility distinction has practical implications. If your hardware breaks, you'll need to repair or replace it. If your software glitches, you might need to reinstall it or update it. See how the "differences between hardware and software" impact troubleshooting?