The key differences between proprietary and open-source software lie in ownership, distribution, and modification rights. Proprietary software is owned by a single entity, is typically paid, and restricts users from altering the code or redistributing it. On the other hand, open-source software is freely available for anyone to use, modify, and distribute, fostering collaboration and innovation within the community. This distinction impacts factors such as support, customization, and overall control that users have over the software.