Hi,
The differential backups are all the changes since the last full backup, you would often use these to save time and space when it comes to backing up your database, as you create each diff backup the file would (in theory) be larger than the last diff backup as each file contains all the changes since the last full backup. This means that you can restore with just two files, the full backup and the last differential.
Transaction logs give you the ability to restore to a point in time and, providing your databases are in the full recovery model, should be run in conjunction with your full or full/diff backup strategy. The transaction log backups contain all the changes since the last transaction log backup (or full backup which ever was last). To restore with these you still need to make sure you have your full backup file in place but you then have to restore each and every transaction log file sequentially to achieve recovery to the point in time. In addition you need your transaction log backups to manage your transaction logs for any database in Bulk or Full recovery, this will stop your log just growing and growing.