3rd gen core i processors were the previous generation processors launched last year.4th generation core i processors are the latest series of processors launched this june.
to differentiate,
3rd gen is based on a micro-architecture named ivy bridge and has a die size of 22nm.
Present 4th gen is based on latest haswell micro-architecture and has a die size of 22 nm.Intel claims that this new micro-architecture is more energy efficient and gives more performance.
According to some tech-websites 4th gen core processors are on an average 5% more performing than previous gen processors.
4th generation processors are much improved on their integrated gpu part which enables them to perform well in 3d applications and games.
There are also many other differences in their designs and efficiency part.
And to sum up if you want to know all difference just do a google search on it.
If you are planning to buy one ,then you can choose from any of them based on your requirements.
If your requirements are more performance and heavy graphics and has the budget to pay premium, go for 4th gen processors.
If your main concern is budget, you can get some discount on 3rd gen based computers.Actually performance improvements are too hard for an average user to experience or find out.