SEO - (Search Engine Optimization) - It means of optimizing your website so that you get organic (free) traffic from the search engines.
SEM - (Search Engine Marketing) - It is an online marketing strategy that involves getting traffic, paid and unpaid, from the search engines.
"SEM is a form of Internet marketing that involves the promotion of websites by increasing their visibility in search engine results pages (SERPs) through optimization and advertising."
Both strategy help to increase visibility in the search engine and gain huge genuine traffic on your website. So SEO work likes free or SEM run paid campaign to gain effective results.