A compiler translates high-level code into machine-readable code, while an interpreter converts each line of high-level code into machine code as the program runs. The document provides examples of compiler and interpreter code and compares key differences between compilers and interpreters, such as compilers generating independent target programs while interpreters evaluate source programs on a statement-by-statement basis without generating output. Compilers are suitable for production while interpreters are suitable for development due to not needing recompilation after each source code change.