1. Jihad can be launched only by an established authority as a policy in order to deter aggression. Terrorism, on the other hand, is committed by individuals or groups that have no legitimacy to speak for the majority. When terrorism is committed by states, it usually depends on misleading the masses.
2. Jihad is limited to combatants while terrorism involves indiscriminate killing of civilians.
3. Jihad, when the need arises, is declared openly, while terrorism is committed secretly.
4. Jihad is bound by strict rules of engagement while terrorism is not bound by any rules.
Also note, the word Jihad does not mean to kill infidels as is often said by racist fatherless children ie-bastards, but rather defend Islam against those who wish to destroy it. Islam does not say to conquer the world and enslave or kill all infidels.
radical Translation: kill anyone that is not muslim
educated Translation: War within oneself; struggle to find the true meaning of islam