Emulator behaves as the original device that is referring in point of view of hardware and software. Simulator behaves as the original device in point of view of software. Emulators fully copy the features of original device while simulators tend to copy the features in point of view of software. You can say that the simulator uses different processes to achieve same results.
Let take the example of aircraft. If you talk about simulator then aircraft can be imagined but not fully. While with emulator the aircraft can be fully compared and tested, I mean that you can make the same aircraft in small toy size and check the flight and landing also.
Let me take you another example of processor. Emulator can behave as processor and accepts the input and gives output similarly as the original processor. Emulator may use same processes as the original processor.
Simulator can be router that tends to behave like the real router but may use software and different techniques and processes. As in the laboratory the original router cannot be purchased so emulator and simulator are used for this purpose.
So the end result is that emulators use both software and hardware while simulators only use software.
