At first glance, the Bookmarks and Favorites folders have a similar purpose, but in reality this is not entirely true. Use the Bookmarks folder to store links to sites you want to visit again, and Favorites to store links to your favorite portals. In short, if you save too many bookmarks, it can get messy over time, so try organizing them into folders.
Both 'Bookmarks' and 'Favorites' are in one place – in the side bookmark menu – however, only bookmarks from 'Favorites' can be placed directly below the address bar on the special 'Favorites' line.