Thats about all there is common between them.

First of all, simply put Layer 3 Switches work in a LAN environment while routers work in a WAN environment, although some L3 switches are being used in a WAN environment in recent times, like multiprotocol label switching (MPLS) However, a L3 switch operates much much faster than a router. So while a router gets a packet, it tears it down, analyzes the destination address, rebuilds the packet, finds out the best next hop for the packet and sends it along. This takes a definite amount of time and hence, there is a slight delay associated with this process. However, an L3 switch, when it gets a packet, tears it down and analyzes the destonation address, and based on the routing table decides the next hop for it. What it also does is create a cache of the source-destination pair as well as the next hop for it in a fast memory. So the next time a packet bearing similar characteristics comes along, it immediately sends it along to the next hop, which it has stored and hence doesn't have to go through the process of searching and doing it all over again. Thats why its also called "route once, switch many" So you see, while an L3 switch operates faster, it lacks a lot of functionality that a router has.