This week's book giveaway is in the OCPJP forum. We're giving away four copies of OCA/OCP Java SE 7 Programmer I & II Study Guide and have Kathy Sierra & Bert Bates on-line! See this thread for details.
My understanding is that the different is size. Unicode is limited to 16 bits to represent each character, while UTF (Uniform Character Set Transformation Format) uses as many bits as needed to encode a charater. I can't speak from personal experience, but UTF primarily comes into play (is needed) when dealing with pictorial type languages: Chinese, Japanese, Korean, etc.