Apple - What is the difference between iTerm2 and Terminal?

There are several features listed on their features page.

Some of the features I like are:

• Split pane view
• Hotkey window for instant terminal anywhere
• Search will highlight all found words (like in Chrome and Safari)
• Mouseless copy
• Instant replay (can "rewind" your session in case you forgot to note/copy something)
• Paste history
• Growl support for notification when a process completes

@joel's answer is good, but Terminal.app gained some exclusive features in Lion:

• support for Lion's restore feature
• support for system services - this means I have a system shortcut for “new terminal in this folder” without strange hacks.
• support for system services means great automator integration
• document proxy in the window and generally better D&D support
• right click on a string to search in man pages or open its man page in a cool floating window. Really handy!

See: http://www.macosxautomation.com/lion/terminal.html

I just love iTerm because it does have the auto-complete for commands.thats just awesome.

From the feature list for iTerm2's on its website:

Just type the start of any word that has ever appeared in your window and then Cmd-; will pop open a window with suggestions. The word you're looking for is usually on top of the list!