The PowerApps is an application development platform that is part of the broader Microsoft Power Platform, whose capabilities are built on and utilize Azure cloud services. Dynamics 365 for Sales, Service, Field Service, Marketing, and Talent are all built naively on the platform. Using PowerApps, users can now build their own custom line of business applications using Azure cloud services to scale from personal use to enterprise-level using little-to-no code and running both mobile or desktop devices.
Model-driven power apps are built using the Dynamics 365 framework and can only connect to the Common Data Service as their data source. These applications are more suited to complex scenarios with multiple functions and utilize the Unified Interface UX.