A will is a legal document that allows you to direct how your estate will be handled at your death. With a will, you are able to choose your heirs, rather than leaving that to be decided by the state. For example, if you wish to leave property to a charity, church or other individual with whom you are not related, you need to create a will. With a will, you can also establish what will be done with any assets you own, including real estate, at your death. You may also select who will serve as your personal representative (overseeing the administration of your estate), and you can appoint an individual(s) to serve as guardian for any minor children.
A living will is a document that makes known your desires regarding medical treatment in circumstances in which you no longer have the ability to consent to treatment or the withdrawal of treatment. The most important thing a living will addresses is in which circumstances you would not wish for your dying to be artificially prolonged (though doctors would still provide medication to keep you comfortable during that time). This means you will authorize doctors to withhold treatment in certain circumstances or authorize doctors to withdraw treatment in others. In this same document, you can address whether you intend to be an organ donor.
Another helpful document that complements the Living Will is a Medical Power of Attorney (or Power of Attorney for Healthcare). This document allows you to designate who will make medical decisions for you, according to your known wishes, in the event that you become unable to make those decisions for yourself.