Both the AES and RC4 are encryption ciphers. However, AES is actually new, and it is very complex, RC4 is relatively old, and it is very simple and basic. A very significant difference between the two is actually their type. AES is a block cipher that operates on discrete blocks of data by the use of a fixed key and a formula, on the other hand, RC4 is a stream cipher that does not have any discrete block size.
Instead of that, it uses a keystream of pseudo-random bits, which is combined with the data by the use of an exclusive OR (or XOR) operation. Block ciphers can be used as stream ciphers and vice versa. But it is quite well known that RC4 is not very effective when used as a block cipher. RC4 is not as secure as AES. RC4 is trademarked because it was initially considered a trade secret, but AES is not.