Block ciphers encrypt data in fixed-size blocks, while stream ciphers encrypt individual bits or bytes. Stream ciphers are generally faster than block ciphers but are more difficult to implement securely. Block ciphers are better for known data sizes like files, while stream ciphers are better for unknown or continuous data like network streams. The document discusses the advantages and disadvantages of stream and block ciphers, including that stream ciphers encrypt individually while block ciphers encrypt blocks, and that errors affect entire blocks for block ciphers but only individual pieces for stream ciphers.