Functional Testing is testing the implementation of 
requirements of an application. 

System Testing is tesing implementation of requirements 
with all its internal and external components that make a 
complete system.

Functional Testing:
        Is to test whether the functions specified by the 
client in the  requirements is functioning(working) 
correctly or not.

System Testing:
         Testing the entire application as in the real 
scenario. i.e. testing the application as in the client 
environment

Functional Testing:
              Is to test whether all the functionalities 
are working properly r not as specified in the SRS?

System Testing:
                when once application is developed ,it will 
be deployed in to a client specified environment to become 
a system.

functional involves testing the functional requirements.

system testing involves testing both the functional and non 
functional requirements.

Functinal Testing is part of System testing..
System testing involves testing Functional,Non Functional 
and Usability testing.
System testing depicts the system as a whole, where as 
functional tetsin may be testing a single/whole ...

Functional testing: It is Manditory testing level in system
testing during this  time the test the testing team is 
concentrating on the correctness and completeness of the 
customer requirements 

System testing:System testing is the behavioral of the 
whole system it will do based on requirements .It should 
nvestigate the both Functional and nonFunctional 
requirements

important difference is
In functional testing: we do  unit functionality testing
ex:each feature of the appl is verified(text field 
validation and functionality of command buttons)

In system testing:Majorly concentating on the flow of the 
application w.r.t to a perticular functionality.