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The key difference between experimental and observational study is that an experimental study is a study where the researcher has control over most of the variables. On the other hand, an observation study is a study where the researcher merely observes the subject without controlling any variables.
Observational Methods in psychological research entail the observation and description of a subject's behavior. Researchers utilizing the observational method can exert varying amounts of control over the environment in which the observation takes place. This makes observational research a sort of middle ground between the highly controlled method of experimental design and the less structured approach of conducting interviews.