dvergin pretty much summed it up, however, I thought take a shot at a practical example--because I think the difference is somewhat more important that "mostly pointless." (Not trying to pick a fight, gryng, just seeing things from a different point of view.)

Encoding (perhaps inappropriately) can be thought of as a communition protocol. It tells clients or transfer agents how to interprete a datastream. When you email me a spreadsheet, for example, my email client uses the encoding to know how to interprete the attached bits into a coherent pattern, a file to be opened later.

As faerloche and arhuman reminded me recently, encoding can be used by any agent receiving that datastream. Thus, if someone intercepts that email message, they can easily open the attached spreadsheet on their own desktops.

Encyption, however, is a privacy device. Only the person with the right key can unlock the encrypted data into a viewable form. Think of it as a wrapper around your data. Encrypted data will be send as an encoded datastream, however, only the person with the right key will be able to makes sense of it.

This is an oversimplification, of course. But I think it illustrates the difference as I understand it.

Also, if you're interested in that book jorg mentioned and want to buy it online, you can give the Monastery a small kickback by clicking here. (I noticed that FatBrain lists it under a different ISBN number.)

--f

Update: I originally answered Desdinova's question by updating this node. After further thought (and reflection on a comment chipmunk made recently), I decided that it was better to reply in a separate post, since that's really a different topic than what I was originally trying to address. To-MAY-to, To-MAH-to. :)