Demons are malevolent spirits that try to do harm to mortal people.
In Christian and Jewish Belief, demons were angels that chose to follow Lucifer as he tried to overthrow God and was sent to Hell as punishment. Demons usually (if not always) try to do harm to someone through several means such as disembodied voices or sounds, shadowy apparitions, physical violence, and in many cases, demonic possession.
Hauntings that involve demons are considered serious by almost all paranormal investigators and psychics. They usually focus on one person of a family, this person is usually the youngest. In some cases the demon will actually attempt to appear as a harmless or playful spirit in order to build a better bond with the person but eventually, usually subtly, the demon will become more harmful and malicious toward the person, and after a short period of time the demon may attempt to possess the victim in order to cause even more harm on the rest of the household.
A psychic vampire is said to be a demon that actually attempts to drain the life force out of a victim, causing several symptoms such as: sleepiness, constant miscarriages, paleness showing that life is literally being sucked out of the body, and in extreme cases, death.
The nature of why a demon attempts to frighten or hurt a person or family is obscure, most people believe it is because they feed on the negative energy caused by its actions, others believe it is because they take pleasure in hurting people, and some believe that is a natural instinct of theirs. Some have placed demons into categories, these categories show the deadly sins depicted in Christian belief and the demons fit into the category of the specific harm they do, demons that cause anger would fall under the wrath category, etc.
Challenging a demon directly is shown to highten paranormal activity if not done so through an exorcism, as shown in one case of a middle-class family living in the United States; the demon/spirit resided in a small shack or shed until the oldest son decided to challenge the demon directly, the demon then made that one boy his target, giving the boy the hallucination that all liquid he feels or touches looks and feels like blood, attacking the boy physically, and even appearing in a shadowy form throughout the house.
Demons are believed to be banished by a ritual known as an exorcism, almost every religion or mythology has a form of this in its beliefs. It is said that you can prevent demonic haunting by: not getting involved in Satanic worship or other similar occult practices, by surrounding the area you wish to be protected by salt, placing crucifixes in rooms or on doorway, or with a blessing by a priest or clergy.
There have been some cases where a supposedly normal ghost in a manner of speaking transformed into a demon, this is shown in a case involving a small family living in Pennsylvania, an apparition of a pale man enveloped in a dark cloak carrying a noose was seen walking in and throughout the home. Upon investigation the family discovered that a man killed his family then hung himself, and after moving to a different home, the family heard how the new owner was driven into a depressed state and hung himself in exactly the same place where the ghost supposedly hung himself. Upon returning to the home to sort of relive the memories of the home, the families two daughters saw a noose appear out of nowhere in the basement.
In the new age we theorize that there are parallel universes. Thus demons are thought to exist in a parallel universe. Demons differ from spirtis. Spirits are singular conscoiusness existing without a physical plane. Demons are creatures that exist in the physical plain and are always viewed as looking like viscious monsters.