The difference between Iron and Steel is that Iron (Fe) is an Element and that Steel is produced from Iron from an industrial process. Steels are alloys of iron. The confusion arises because there are various forms of manufactured Iron, historically, because the Iron metal contained a number of impurties both from its ores (eg South Wales ironstone contains much Calcium as limestone) and from its processing, principally from Carbon from heating but also from Sulphur as impurity from the ore and/or Coke.
Steel is produced principally from the Bessemer process in a Blast Furnace. This process enables the producers to remove virtually all the impurities from the Iron except Carbon which can also be controlled to very stringent specifications. Proportions of other elements, such as Chromium, Mangenese, Molybdenum, etc. can then be added in very specific amounts to produce the physical or chemical properties required: for example type 316 stainless steel is purified Iron plus Chromium, Molybdenum and Nickel with traces of other elements, to produce a stainless steel of high strength which can be welded more easily than other steels. Other steels requiring other properties can be produced from other blends.
I produced this blog because I wanted the information myself and was amazed at the rubbish which I found on various websites. The information on the Bessemer website can be found here. I hope this helps others. http://en.wikipedia.org/wiki/Bessemer_process