Priority: This is defined as how much time that developer 
should take to solve that bug depending upon the 
fuctionality.

severity: This is defined as how much impact is shown on 
the functionality.

High severity cases can be given low Priority
Ex: Few applications may have been developed 80% and 20% 
may be missing which is high severity, but test engineer 
may cnsider it as low priority as he is already knows that 
the application will anyways be developed.

Low Severity cases can be given high priority
Ex: For an application where in the client needs to check 
how is it progressing, low severity cases like spellings, 
grammar are given high priority and rectified.

Priority: The seriousness of the defect according to the 
client requirement is called Priority.

Severity: The seriousness of the defect accroding to the 
functionality is called severity.

Priority : Giving Based on Business.

Seviarity : Giving based on Functionality.

seviarity define bug on the functionality 
priority defines order of impotences

Priority define: what is the time line require to complite 
for the same, time frame require to complite the task.
Priority Levels:
1- HIGH (Need Attention Immediately) 
2- MEDIUM (Work-around Available - Can be release in the 
next build)
3- LOW - (Cosmetics/Trivial defects) Low priority
 Serity define: How much impect the bug to code.

Severity Type:
1- System Inoperative
2- Functional Inoperative
3- Serious
4- Cosmetics
5- Nice to have (enhancements)
6- CR (change request)

. Severity: How bad a bug is? Means impact on the 
application
Priority: How soon the bug need to be fixes? Means 
Importance in terms of both application and client

Example: 
Let us take an example of data entry screen of an 
application.

For High Severity and low Priority
1. Application get closed itself after entering 100 records 
then again needs the application to restart. 

For High Priority and low Severity
2. After entering record the message prompt showing the 
message has some spell mistake.


Vimal (Test Engg

priority 
   how soon the bug has to be fixed?
1-critical
2-high
3-medium
4-low


severity
   how much effect the bug has on the functionality of the 
application?
showstopper -  stops the application no work around 
solution 
critical - stops the application but work around solution 
are there
high - severe loss in business logic
medium -  minimum loss in business logic
low - cosmetic bugs

the way of mentioning severity and priority vary frm 
company to company

Severity
---------------
1. Bug causes system crash or data loss.
2. Bug causes major functionality or other severe problems; 
product crashes in obscure cases.
3. Bug causes minor functionality problems, may affect "fit 
anf finish".
4. Bug contains typos, unclear wording or error messages in 
low visibility fields.
 
Priority
---------------
1. Must fix as soon as possible.  Bug is blocking further 
progress in this area.
2. Should fix soon, before product release.
3. Fix if time; somewhat trivial. May be postponed.


Severity: Severity determines the defect's effect on the 
application. Severity is given by Testers
Priority: Determines the defect urgency of repair.Priority 
is given by Test lead or project manager

1. High Severity & Low Priority : For example an 
application which generates some banking related reports 
weekly, monthly, quarterly & yearly by doing some 
calculations. If there is a fault while calculating yearly 
report. This is a high severity fault but low priority 
because this fault can be fixed in the next release as a 
change request.


2. High Severity & High Priority : In the above example if 
there is a fault while calculating weekly report. This is a 
high severity and high priority fault because this fault 
will block the functionality of the application immediately 
within a week. It should be fixed urgently.


3. Low Severity & High Priority : If there is a spelling 
mistake or content issue on the homepage of a website which 
has daily hits of lakhs. In this case, though this fault is 
not affecting the website or other functionalities but 
considering the status and popularity of the website in the 
competitive market it is a high priority fault.


4. Low Severity & Low Priority : If there is a spelling 
mistake on the pages which has very less hits throughout 
the month on any website. This fault can be considered as 
low severity and low priority.

Priority is used to organize the work. The field only takes 
meaning when owner of the bug
P1 Fix in next build
P2 Fix as soon as possible
P3 Fix before next release
P4 Fix it time allow
P5 Unlikely to be fixed
Default priority for new defects is set at P3

I am not Challenging some One but according to me,

Severity:-Impact of bug on the Software Functionality is
Called as Severity Of the S/w.

Priority:-It describes the Order in which we have to fix the
bug.

severity defines the how bad the bug is and reflects its 
impact on product or user.

Priority defines how important it is to fix the bug and 
when it should be fixed.

E.g.

Types of Severity can be

1>Critical
2>Major
3>Minor

Example of priority can be as below.

1> Immediate Fix
2> need to fix in next release
3> can fix if time permits
4> can fix but can release as it is.

Severity is assigned by the QA Tester on the bug found. Particularly based on the impact on the application.

Priority is assigned by the TestLead/Test Manager/Dev Lead/Dev manager based on the release schedule of that application. Particularly based on how soon the defect needs to be fixed.

High Severity Low Priority: If a Bug is found in an application that is not allowing the tester to Proceed with testing, then its of High severity. But if the application is going to release only after 6 months, then it becomes low priority.
High Priority Low Severity: If a spelling mistake is found on a login page with client logo/name, its a low severity. But, if its on the name of the client itself, it becomes a high priority.