Elements are the simplest building blocks you can break matter down into using purely chemical methods. They are a pure substance made up from only one type of atom.
When you mix elements together these form compounds. The important difference is that as they are a mixture of more than one type of element, they CAN be broken down into more simple substances using chemical means!
As such Hydrogen or Oxygen cannot be simplified chemically (they are therefore elements), however dihydrogen monoxide (H2O or water) is a mixture of these elements that can be broken down using chemical means and so is a compound.
