If psychology is the big umbrella of research addressing human behavior and mental processes and/or functions, then applied psychology is smaller sub-category under the big umbrella and different from the “basic psychology” that seems to be covered in most undergraduate psychology courses and general psychology education (the other sub-category under the psychological umbrella). The “basic psychology” includes (among other topics or sub-dimensions) abnormal, cognitive, neuropsychology, personality, positive, and social psychology.
Applied psychology – the field I’m officially educated in – includes clinical, educational, forensic, health, human factors (engineering), industrial-organizational, occupational health, school, and sport psychology. It can be psychology applied to business, the law, product design, management, mental health, etc.
To be fair, this blog covers a fair amount of personality, positive, social, and even cognitive psychology, but in practice, the lines and divisions are much less clear and it’s often hard to distinguish where one sub-dimension ends and another begins. But I try to categorize research this way because I find it useful, which is why I’ve tried to explain the family of psychological research areas here. For more information, Wikipedia explains applied psychology quite well here.