An in-text citation:
... demonstrates, in combination with the academic content, the author´s knowledge of the field and the literature associated with it
... helps demarcate own intellectual output vis-à-vis loans from other people´s works.
... always points to a bibliography entry where more information about the source is available.
A reference:
... points to the outside world and allows for unambiguous and unequivocal identification and retrieval of the sources used.
NB. The exact format of both in-text citations and references is dictated by the reference style of choice, e.g. APA, MLA, Harvard.