They are two completely different protocols, with iMessage's featureset being a superset of SMS's. If you are conversing with someone else with iMessage (either through an iPhone or another Apple device), Messages will automatically use iMessage; otherwise, it will use SMS. (If you prefer to use SMS, you are welcome to disable iMessage on your phone or other Apple device.)
iMessage goes over the IP network, not a side-channel in the cellular system the way SMS does—so you have to have either Wifi coverage or cellular data available; if you don't, as a matter of fact, it falls back to SMS within the same conversation, provided you are conversing with someone else who is identified by a phone number, and not just an Apple ID.
On the iPhone, the Messages app handles SMS.
It also handles iMessage.
They are two completely different protocols, with iMessage's featureset being a superset of SMS's. If you are conversing with someone else with iMessage (either through an iPhone or another Apple device), Messages will automatically use iMessage; otherwise, it will use SMS. (If you prefer to use SMS, you are welcome to disable iMessage on your phone or other Apple device.)
iMessage goes over the IP network, not a side-channel in the cellular system the way SMS does—so you have to have either Wifi coverage or cellular data available; if you don't, as a matter of fact, it falls back to SMS within the same conversation, provided you are conversing with someone else who is identified by a phone number, and not just an Apple ID.