AWD has to allow slippage between the front and rear driveshafts. 4WD is not allowed to have slippage between the front and rear drive shafts. AWD is geared towards "always on" type of 4WD where they reduce wear and tear by allowing some slip, which is okay on snow and ice. 4WD does NOT allow slip, but usually has to be manually engaged (note: I said usually, I've driven one that was full time 4WD, and you knew it), 4WD is better on surfaces where you're crawling up it at a slow speed and don't want anything to slip at all, just all grip.