To put it simply, an account contains
a collection of profiles. Note, if you
have a simple website, you can
probably get by without creating
profiles. Profiles exist to let you do
two important things.
- Separate out information about specific web properties, like your
- Apply different rules and criteria for advanced analysis...
source: Monday Back to Basics: Accounts vs Profiles
Profiles are useful for getting analytics reports on a specific group of visitors; new visitors only, for example. You can have a separate profile, and thus a separate report based on visits only from new visitors.
Profiles can also be used to track multiple (sub) sites with a single account. Note that if you track different web sites with the same account, the accumulated data cannot be separated into two accounts later. One significant result of this: if you give someone admin access to one profile, they get admin access to all the other profiles in that account (you can still limit read-only access to a single profile).
Some more detailed info: Accounts and Profiles