How Do You Differentiate Science Fiction From Fantasy?

Science fiction is as a rule based on recognizable technology. Robots are recognizable, even if they don't exist. Sci Fi books that don't take realism into account tend to fail, that's not what the readers are looking for. If you are doing something outlandish in Sci Fi, you better be prepared to defend how its possible! Fantasy is almost the opposite, in a fantasy novel the further you can remove the reader from reality the more successful you are. Tolkien created an actual alternate language to create a convincing tongue for his natives! Same level of thought applies, but the focus (instead of convincing you of its realism) is to convince you that you are somewhere else. Somewhere believable in its context, but very removed from what you know. That allows for fantasy to happen within the context of the book's reality, and creates guidelines for what kind of magic is allowed. Great topic!

fiction is untrue and science fiction often involves futuristic technology. larger than life stories.

Oooooh, this is a great question! Well, I believe that generally speaking science fiction is based in the future, and fantasy tends to feel like the past (sometimes present). There is definitely a fine line. I would say fantasy delves into more magickal/spiritual realms, as well; whereas, science fiction, as per its name sake, deals with more realistic sounding, even political, scenarios. I could be totally off here, but I am a fan of both genres, so this is just my personal observations. I hope that helps clarify things a little more for you.