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Vessel is a catch-all term, like 'watercraft', which describes any floating object used for the carriage of people or goods. Generally smaller and less complex vessels are 'boats', whilst larger and more complex vessels are 'ships'. As a general rule, you can put a boat on a ship, but you can't put a ship on a boat.
a vessel for transport by water, constructed to provide buoyancy by excluding water and shaped to give stability and permit propulsion. 2. a small ship, generally for specialized use: a fishing boat. 3. a small vessel carried for use by a large one, as a lifeboat: They lowered the boats for evacuation.