What is the difference between a daemon and a server process?

A 'daemon' is a software process that runs in the background (continuously) and provides the service to client upon request.

For example named is a daemon. When requested it will provide DNS service. Other examples are:

• xinetd (it is a super-daemon, it is responsible for invoking other Internet servers when they are needed)
• inetd (same as xinetd, but with limited configuration options)
• sendmail/postfix (to send/route email)
• Apache/httpd (web server)