Although both components manage the flow of electrical current with electrical applications, they differ in their design, purpose, and applications. However, contactors and relays are often mistakenly used interchangeably, which can have devastating effects, i.e., damage to the electrical system.

Typically, a contactor will be used in situations where power loads need to be turned on and off frequently or rapidly. However, they can also be configured either to power on a circuit when activated (normally open, or NO contacts), or to shut down power to a circuit when activated (normally closed, or NC contacts).

For one, contactors are held closed electrically. Latching relays are held closed either mechanically or with a permanent magnet and must be unlatched by a separate signal.