What is the difference between direct thermal and thermal transfer printing?

The basic difference is that thermal transfer printing utilizes a thermal ribbon and direct thermal printing does not. 

Thermal transfer printing involves the thermal print head elements heating the backside of a thermal transfer ribbon to melt and transfer the compounds on the front side of the ribbon to the label material, thererby creating the printed image. 

Direct thermal printing however, requires a heat sensitive label material. The print head elements come into direct contact with the heat sensitive material where the heat from the elements causes a color change in the material to create a printed image.