We Hindus often hear the words "ishwar" and "bhagvan" . What are the differences between these two words?
Bhgavan is a term made of two different words, bhaga and van. Bhaga generally means supreme opulence. The Vishnu Purana defines bhaga as below:
So just like one who has dhana (wealth) is known as dhanavan, one how has all these six is known as bhagavan. ( bhaga + van = bhagavan ) But the opluences descried above are only found in the supreme personality of Godhead. Hence, the absolute truth, Brahman is also called as Bhagavan.
Now, regarding Ishwara, it has been derived from the Sanskrit root ish, which means to rule. So Ishwara means the supreme being who rules over everyone. But as God is only such being, He is also known as Ishwara. ( īśate iti īśvaraḥ )
So irrespective of whether we say Bhagavan or Iswara, both imply the same personal form of God. Just their meanings are different.
In Hindu Religion, the word Bhagwan has symbolic meaning too. The word encompasses Earth, Water, Fire, Air and Space – the five elements. Thus the term Bhagavan translates as the manifestation of the physical form of universe.
In the word भगवान (Bhagavan) –
‘भ’ stands for Bhoomi or Earth
'ग' stands for Gagan or Space
‘व’ stands for Vayu or Air
‘आ’ stands for Agni or Fire
‘न’ stands for Neer or Water
Short version of jabahar's answer with an analogy:
There is no difference, the same way there is no difference between