To research means to collect information in order to understand how something works or why it behaves in a certain way.
Development means taking things a stage further, producing a piece of equipment or a new drug.
Research and development are often closely related - research into how the kidney works may lead to the development of a new drug to treat kidney disease. Research is actively carried out in academic centres like universities and government centres such as SERC or MRC laboratories. Medical research is also often done at the larger hospitals. Companies in lots of different industries also do research. This tends to be mostly applied research and development.