The answer used to be simple. We used to be able to say, "Yahoo
and Open Directory Project are directories. Excite and Lycos are search
engines."
In those long-ago days, had you gone to Excite, you would have been
presented with a search query box. That would be the simple way to tell
that it was a search engine. Had you gone to Yahoo, you would have seen
a page full of categories, and that was how you would know it was a
directory.
In these days, however, most of the search engines and directories
are a sort of hybrid of the two.
What is a search engine?
A search engine uses a program (or "spider") that crawls
through all the pages it comes across. All the words on all those pages
are analyzed and stored. When a searcher queries the search engine,
the search engine applies an algorithm
to determine relevancy, searches its databases, and returns a list of
those documents in which the words are found. AltaVista
is a search engine.
Thus, the actual words on your site -- text, title, and meta tags --
are important for getting a high ranking. If you so much as add a sentence
to your site, the change will affect its search engine ranking upon
respidering or reindexing.
What is a directory?
Rather than using robots, a directory is compiled by human beings.
The human "editors" review potential listings, determine what
they are about, and list them in an appropriate category, along with
what they believe to be an appropriate title. Open
Directory Project is a directory.
Changing your site will not affect your ranking in a directory, unless
it is a drastic change. For instance, if you have a site about poodles,
it would be in the "Poodles" category of a directory with
an appropriate title and description, such as:
Poodles - A site devoted to the breeding, raising, and enjoyment
of poodles for fun and profit.
Naturally, if you decide to remove the poodle information from your
site and sell bathing suits, the site will be moved from the poodle
category and into the bathing suit category with a title and description
appropriate for the overhauled pages.