The HTML sitemap is for humans. It is a quick map/overview of the pages on your site which are listed using links (with anchor text). People can use it to locate a page they need quickly and easily.
The XML sitemap is for search engine spiders/bots. It is there to tell the search engines which URLs are part of your website. It appears as code. It helps the search engines find pages that they might miss on a normal crawl and it is also good if you have dynamic content or is new. Submit the XML sitemap as a feed in webmaster tools.