These two get confused more than any other pair, because both are temporary and both put an experienced operator into a senior seat for a while. But they answer opposite needs. An interim COO is full-time cover for a vacancy — there to keep operations running while you recruit a permanent replacement. A fractional COO is part-time by design, there not to hold a seat but to change how operations work: to install systems and lift the operating model, then transfer it. One is about continuity. The other is about improvement. Choosing the wrong one is expensive, because each is genuinely bad at the other's job.
The clearest way to tell them apart is to ask what triggered the need. If a COO has just left and you have a hole in the org chart that must be covered while you search, that is an interim situation — you need a capable full-time pair of hands to keep the operation steady, maintain relationships, and prevent drift during the gap. If nothing has left but the operating model itself has stopped scaling cleanly — decisions queueing, quality held together by heroics, growth creating firefighting — that is a fractional situation. You do not need cover. You need someone to fix how the thing runs.
I am straight with prospective clients about which they need, because sending a fractional engagement at a continuity problem helps no one. If you have a sudden vacancy and a working operation that simply needs a steady hand full-time until you hire, an interim COO is the right answer and I will say so. Where I add the most is the other case: when the real problem is the operating model, and what you want at the end is not a maintained status quo but a genuinely better-run business with systems your own team can hold.