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Vessel is a catch-all term, like 'watercraft', which describes any floating object used for the carriage of people or goods. Generally smaller and less complex vessels are 'boats', whilst larger and more complex vessels are 'ships'. As a general rule, you can put a boat on a ship, but you can't put a ship on a boat.
Best Answer: One definition that is often used is that you can fit a boat inside a ship but you cannot fit a ship inside a boat. A ship is a commercial vessel such as a passenger ship, a freighter or a tanker. A boat is smaller - could be a fishing boat, a dinghy, a sailboat, a row boat, etc., and could actually be fairly large. A yacht is a personally owned pleasure boat, either a sail boat or a power boat, but is not a ship.