An Index stores the location of the row being looked up. It speeds up data retrieval as the engine does not have to perform a complete ‘table scan’ to find the row being queried.
A clustered index physically sorts the table upon the member columns. A non-clustered index stores the key value and the row index where to find that row.
A nice example to explain this difference is a book index that stores terms with page numbers and behaves like non-clustered index; while a phone book stores names and numbers – if the number is stored with the name – behaves like a clustered index.
