Simple. Warband has multiplayer, some more features in singleplayer, and other mods than M&B.
These features include: Ability to court and marry eligible Ladies (or, if you play as female, to court&marry eligible Lords).
A new faction, the Sarranid Sultanate.
The ability to host and attend Feasts.
And maybe some other ones I forgot at the moment.
it improved the combat system a lot and the npc's are a bit better as far as tactics and their general awareness (not walking into rocks and walls as much)