Let's hear it for Wikipedia:
Under some atmospheric conditions, snow crystals may encounter supercooled cloud droplets. These droplets, which have a diameter of about 10 µm, can exist in the liquid state at temperatures as low as -40 degrees F, far below the normal freezing point. Contact between a snow crystal and the supercooled droplets results in freezing of the liquid droplets onto the surface of the crystal. This process of crystal growth is known as accretion. Crystals that exhibit frozen droplets on their surfaces are referred to as rimed. When this process continues so that the shape of the original snow crystal is no longer identifiable, the resulting crystal is referred to as graupel.[3] Graupel was formerly referred to by meteorologists as soft hail. However, graupel is easily distinguishable from hail in both the shape and strength of the pellet and the circumstances in which it falls. Ice from hail is formed in hard, relatively uniform layers and usually falls only during thunderstorms. Graupel forms fragile, oblong shapes and falls in place of typical snowflakes in wintry mix situations, often in concert with ice pellets. Graupel is also fragile enough that it will typically fall apart when touched. [4]
I think it differs from hail in that the conditions that form it are colder and I also remember that hail gets circulated a number of times in the convection column of the cloud, where graupel seems to fall straight through, picking up moisture as it goes.
Also, it doesn't hurt as much... .
g.
