What is the difference between clustered and non-clustered indexes?

A clustered index determines the physical order of data in the table - the table IS the index. Only one clustered index per table (usually on primary key). A non-clustered index is a separate structure with pointers to data rows - multiple can exist per table. Clustered index lookups are faster as data is retrieved directly. Non-clustered requires additional lookup to get actual data (bookmark lookup). Choose based on query patterns.