SATAN (ADVERSARY / ENEMY): is the name given unto the chief fallen angel once known as Lucifer. Lucifer is said to have been "perfect in wisdom and beauty until iniquity was found in him." Lucifer had been the "Covering Cherub" a place of high position, but thought to make himself like unto God and worshipped. He was thrown down from his lofty position decree of God at some unknown point. We find Satan already fallen by the time man dwells in the Garden of Eden. Revelation 12 clearly identifies him as that "Old Serpent" the Devil. Contrary to popular opinion, the bible never places Satan as a king dwelling in Hell. He is in fact roaming throughout the Earth along with other rebellious angels seeking to oppose God, particularly in his plans for humanity. There is nothing biblical to suggest that Satan has been transformed into some monsterous red-suited, horned creature. He is an angel although rebellious and cast down.
DEMONS: are fallen angels who followed Lucifer in his rebellion against Almighty God at a point sometime before the fall of man in the Garden of Eden. We do find that these angels have inhabited the bodies of unbelievers, particularly during the course of Jesus earthly ministry when he cast many out. Satan also indwelt Judas Iscariot as he went to betray Jesus to the Pharisees for money. There is no biblical evidence to support demonic possession of a truly saved person!