its regretable- suggests a mistake was madfe its a pity -suggests that the situation is really bad -not so much a mistake as it is just a sad situation

There really is no difference between the two phrases, in terms of meaning. Oftentimes with English, as with any other language, there are many different ways of saying the same thing. Each way has its own tone, its own feeling, determined by the sound, or "attitude", of the word or words being used. "That's no good", "That stinks", "That sucks", "That's the pits" have a meaning synonymous with "It's regrettable" and "it's a pity". If you know English well enough, each form of an expression has an attitude of its own, and you can use whichever you choose based on its "attitude" or the way you like to say it. Another example would be to use really strong words if you are upset - it conveys a stronger emotion, and gets more attention.

Thank you Tom! I feel the difference now. Examples always help.

A few examples: It's a pity we couldn't settle our differences (the situation has been accepted) It's regrettable we couldn't settle our differences (suggests the person thinks about what they could have done differently to have made this situation better)

I think It's regrettable is more personal than It's a pity, because to regret something implies it's on your mind and you wish things had been different. It's a pity seems more of a general acceptance that the situation is how it is without much personal attachment. However, with It's regrettable it is less personal than the construction I regret and can be used as a general statement like It's a pity.